A residential property is assessed for tax purposes at 40% of its market value. The residential property tax is 3 1/3% of the assessed value and the tax is $1200.
a)What is the assessed value of the property?
b) What is the market value of the property?
a 3 1/3% = 3.33333%/100% = 0.033333 = %
rate expressed as a decimal.
0.033333A = $1200.
A = $36,000. = Assessed value.
b. 0.4M = $36000.
M = $90,000. = Market value.
To solve this problem, we need to use some basic algebraic equations. Let's break it down step by step:
a) Let's assume the market value of the property is "x." According to the information given, the assessed value is 40% of the market value. So, the assessed value would be 40% of x, which can be written as 0.40x.
b) The residential property tax is 3 1/3% of the assessed value. This can be written as 0.0333 times the assessed value. So, the amount of tax can be calculated as 0.0333 times 0.40x, which is given as $1200.
Now, let's solve the equations:
a) 0.0333 * 0.40x = $1200
Simplifying the equation, we have:
0.01332x = $1200
Divide both sides of the equation by 0.01332:
x = $1200 / 0.01332
Calculating that, we find that x (the market value of the property) is approximately $90,090.09.
b) Now that we know the market value, we can find the assessed value by multiplying the market value by 40%:
Assessed value = 0.40 * $90,090.09
Assessed value ≈ $36,036.04
So, the assessed value of the property is approximately $36,036.04, and the market value is approximately $90,090.09.