In the calculation for capitalization, what is 8.9% of 1 million?

To calculate 8.9% of 1 million, you would follow these steps:

1. Convert the percentage to a decimal by dividing by 100. Thus, 8.9% becomes 0.089.

2. Multiply this decimal by the total amount (1 million, which is 1,000,000).

Here's the calculation:

0.089 × 1,000,000 = 89,000.

This calculation shows that 8.9% of 1 million is, in fact, $89,000. This is important in real estate and property management as it helps with understanding capitalization rates and valuations, where such calculations are commonly employed to assess the potential income of properties relative to their worth.

The other options do not represent 8.9% of 1 million:

• $8,900 would be 0.89% of 1 million.

• $7,417 does not correspond to any percentage that would reflect 8.9% of 1 million.

• $14,900 would be approximately 1.49% of 1 million.

Thus, the correct answer is indeed $89,000, not $7,417. This reinforces the importance of accurate calculations in property