Property Valuation

Replacement cost in the cost approach uses:

AThe original construction cost of the improvements
BThe cost to build a functionally equivalent structure using current materials and standards✓ Correct
CThe cost to rebuild the identical structure with the same materials
DThe assessed value assigned by the county

Explanation

Replacement cost is the cost to build a structure of equal utility using current materials, design standards, and construction methods — not necessarily identical to the original. Reproduction cost uses identical materials and design.

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