A 5-Unit Apartment Property Rents for $820 Per Unit Per

question 12

Multiple Choice

A 5-unit apartment property rents for $820 per unit per month. Expenses and vacancies average $800 per month. The asking price is $660,000. What is the capitalization rate?

• A) 5%
• B) 6%
• C) 10%
• D) 11%

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Definitions:

Effortful Processing

A type of information processing that requires attention and conscious effort to encode or transform information.

Automatic

Processes or behaviors that occur with little or no conscious awareness or control, often as a result of learning and repetition.

Creatively

In a manner involving the use of the imagination or original ideas to create something; inventively.

Priming

A psychological technique that involves the subconscious activation of certain associations, influencing behavior and perceptions.