Reference no: EM132568808

Questions -

Q1) A building with an annual net operating income of $80,000 is valued at $800,000. What is the estimated value of the building if the capitalisation rate is increased by one percentage point?

a) $533,000.

b) $727,000.

c) $800,000.

d) $809,000.

Q2) A freehold property has just been sold for $32,000,000. The property was subject to a recently negotiated lease but the rental has not yet been disclosed. The purchaser will adopt a notional yield of 8%. Ignoring purchaser's costs, what rental value does this transaction show?

a) $3,200,000.

b) $2,560,000.

c) $2,650,000.

d) $3,020,000.

Q3) A property has outgoings that are 32% of gross income, which is $125,000. Using a 14% capitalisation rate, what is the value of the property?

a) $607,143.

b) $892,587.

c) $1,178,571.

d) $1,313,025.