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Question
Which of the below statements is TRUE?A) The debt-to-service coverage ratio (DSC ratio) is the ratio of a property's net operating income (NOI) multiplied by the debt service.
B) The higher the DSC ratio, the more likely it is that the borrower will be able to meet debt servicing from the property's cash flow.
C) The NOI is defined as the rental income plus cash operating expenses (adjusted for a replacement reserve).
D) A ratio less than 1 for DSC means that the cash flow from the property is sufficient to cover debt servicing.
Answer
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