Equity Dividend Rate [4046]

If net operating income is $45,000, annual debt service is $25,000, and the equity investment is $100,000, what is the equity dividend rate?

Equity Dividend = NOI - annual debt service

Equity Dividend Rate = Equity Dividend ÷ Equity Investment

Equity dividend = $45,000 - $25,000 = $20,000

Equity dividend rate = $20,000 ÷ $100,000 = 0.20 (20%)