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yawa3891 [41]
3 years ago
9

An income property has a gross annual income of $14,250 and monthly expenses of $300. It has been valued at $147,000. What is th

e capitalization rate?
Business
1 answer:
sergiy2304 [10]3 years ago
8 0

Answer: 0.072

Explanation:

From the question, we are given the information that income property has a gross annual income of $14,250 and monthly expenses of $300 and that it has been valued at $147,000.

The capitalization rate will be calculated as:

= [$14, 250 - ($300 X 12)]/$147,000

= ($14,250 - $3,600)/$147,000

= $10650/$147,000

= 0.072

= 7.2%

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