A Building Owner Charges Net Rent of $20 in the First

question 27

Multiple Choice

A building owner charges net rent of $20 in the first year,$21 in the second year,and $22 in the third year.Using a 10 percent discount rate,what is the effective rent over the three years?

• A)$20.00
• B)$20.94
• C)$21.73
• D)$52.07

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Definitions:

Owner's Rights

Legal rights conferred to owners, entitling them to use, enjoy, and dispose of their property as they see fit.

Strict Foreclosure

A legal process by which the secured lender obtains the title to the mortgaged property without the sale thereof, when the borrower fails to meet the obligations.

Deficiency

The difference between the amount owed on a loan and the amount recovered from selling the asset securing the loan if the latter is less.

Mortgagor

A mortgagor is an individual or entity who borrows money to purchase property and pledges that property as security for the loan.