VALUATION OF REAL ESTATE CHAPTER 1 & 2 E-BOOK
Chapter-1 Valuation of Real Estate
Valuation is an art of judgment based on experience and relevant statistical data to forecast the value of a property at present.
Cost, Price and Value
Definition of Price
Price is the amount of money paid by the buyer to the seller in exchange for any product and service. The amount charged by the seller for a product is known as its price, which includes cost and the profit margin. For example- If you buy a product for Rs 250, then it is the price of that product.
Definition of Cost
Cost is the amount incurred on the inputs like land, labour, capital, enterprise, etc. for producing any product. It is the amount of money spent by the company in the manufacturing of a product.
For example- If a company manufactures shoes, then the expenses incurred on raw materials, salaries, rent, interest, taxes, duties, etc. determine the cost of the product.
Definition of Value
Value is the usefulness of any product to a customer. In terms of money and varies from customer to customer. For example- If you are going to a gym by spending 1000 bucks a month,
the output seen is worth the expense, then it is the value that you create for a gym, regarding the service being offered there. Here the worth is its value. …….
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