The basic formula for the cost approach is

Multiple choice — select the best answer

ALand value + Reproduction cost – Depreciation + Net income
BLand value + Depreciated cost of improvements
CReproduction cost – Land value + Depreciation
DMarket value – Land value + Accrued depreciation

✓ Correct answer: B. Land value + Depreciated cost of improvements The cost approach value indicator equals land value (as if vacant) plus the depreciated cost of improvements. Depreciated cost equals cost new minus accrued depreciation.

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The basic formula for the cost approach is:

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