New Jersey Real Estate Practice Exam Practice Question
A $52,400 investment shows annual earnings of 8.5%. To the nearest dollar, what is the monthly income on the investment?
Correct Answer: B
Rationale: To find the monthly income from the investment, first calculate the annual income by multiplying the investment amount by the annual interest rate: $52,400 * 0.085 = $4,454. This annual income is then divided by 12 months to determine the monthly income: $4,454 / 12 = approximately $371.
Option A ($356) underestimates the monthly earnings, likely due to an incorrect interest calculation. Option C ($409) and Option D ($449) overestimate the income, suggesting a misunderstanding of the annual to monthly conversion. Thus, $371 accurately reflects the monthly income derived from the given investment.
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