Chapter Questions
Based on Exhibit 1, which of the properties is expected to depreciate in value?A. Property 1.B. Property 2.C. Property 3.
. Based on Exhibit 1 and using the direct income capitalization approach, the estimated value of Property 2 is closest to:A. $$\$ 5.3$$ million.B. $$\$ 6.0$$ million.C. $$\$ 7.5$$ million.
Based on Kratky's analysis of comparable properties, the estimated market value of Property 1 from the gross income multiplier approach is closest to:A. $$\$ 5.4$$ million.B. $$\$ 6.5$$ million.C. $$\$ 7.2$$ million.
Is Salazar's statement regarding Property 3's value estimated from the gross income multiplier approach correct with respect to the quoted market value and the value estimated from the direct capitalization approach?A. Yes.B. Only with respect to the quoted market value.C. Only with respect to the value estimated from the direct capitalization approach.
Which method should Kratky use to satisfy Salazar's request regarding the use of the capitalization rate?A. Built-up.B. Market extraction.C. Band-of-investment.
Is Gok's statement reganding the calculation of capitalization rates by the market extraction method correct with respect to sales price and gross income?A. Yes.B. Only with respect to sales price.c. Only with respect to gross income.