How much money will be raised by the property tax rate

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Suppose that there are 150 houses in the community with 2,000 square feet (providing services that rent for $10,000 per year). The interest rate is 4% and with proper maintenance all of the houses will last forever. In an election the population decides that they want public services worth $8,000 per year.

a. What property tax rate will be necessary to fund these public services?

b. How much money will be raised by the property tax rate?

c. What will happen to the value of the houses after the tax is imposed?

Reference no: EM13840172

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