The management agreement provides for a management fee that is usually in the range of 3 to 6% of which of the following measures of property income?
A) Potential gross income
B) Effective gross income
C) Net operating income
D) Income tax liability

Question

Quizplus · Accepted Answer

Effective gross income is typically used as the basis for calculating management fees in property management agreements. This income measure accounts for the actual income received from the property after accounting for vacancy and credit losses, providing a realistic basis for the fee calculation.

The Management Agreement Provides for a Management Fee That Is