Real Estate Appraisal Practice Exam

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Prepare for the Real Estate Appraisal Exam with tailored questions and explanations. Boost your knowledge and confidence to succeed in your appraisal exam!

Each practice test/flash card set has 50 randomly selected questions from a bank of over 500. You'll get a new set of questions each time!

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If the gross rent multiplier extracted from an area is 100x and the gross annual rent is $36,000, what is the assessed value of the property?

$360,000
$3,600,000
$36,000,000
$3,600

The correct answer is: $3,600,000

To determine the assessed value of the property using the gross rent multiplier (GRM) method, you multiply the gross annual rent by the gross rent multiplier. In this case, the gross annual rent is $36,000, and the GRM is 100. The calculation works as follows: Assessed Value = Gross Annual Rent × Gross Rent Multiplier Assessed Value = $36,000 × 100 When you perform this multiplication, you find: Assessed Value = $3,600,000. This calculation aligns with the assessed value listed in the answer option. Therefore, the correct and logical conclusion is that the assessed value of the property is indeed $3,600,000.