A Property Is Purchased for $200,000 with an 80 Percent

question 12

Multiple Choice

A property is purchased for $200,000 with an 80 percent LTV.After five years,the owner's equity is $80,000.What would be the approximate annual expected appreciation rate on home equity (annual EAHE) ?

• A)13.9%
• B)14.9%
• C)20.0%
• D)80.0%
• E)100%

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Definitions:

Deadweight Loss

Deadweight loss refers to the loss of economic efficiency that can occur when the equilibrium for a good or a service is not achieved or is not achievable.

Single-Price Monopolist

A monopolist who charges all consumers the same price for goods or services, regardless of production cost or demand differences.

Deadweight Loss

A loss of economic efficiency that occurs when the equilibrium for a good or service is not achieved or is not achievable.

Average Cost Price

The average cost price is the total cost of production divided by the number of units produced, showing the average expense for each unit.