Assume You Purchased a Rental Property for $100,000 and Sold

question 76

Multiple Choice

Assume you purchased a rental property for $100,000 and sold it one year later for $115,000 (there was no mortgage on the property) .At the time of the sale,you paid $3,000 in commissions and $1,000 in taxes.If you received $10,000 in rental income (all received at the end of the year) ,what annual rate of return did you earn?

• A) 6%
• B) 11%
• C) 20%
• D) 25%

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Definitions:

tRNA

Transfer RNA, a type of RNA molecule that helps decode a messenger RNA (mRNA) sequence into a protein during the process of translation.

Polyribosome

A complex consisting of a number of ribosomes attached to an mRNA during translation; also known as a polysome.

Ribosomes

Molecular machines within cells where proteins are synthesized, following the instructions encoded in RNA.

mRNA

Messenger RNA, which carries genetic information from DNA to the ribosome, where it serves as a template for protein synthesis.