Question

Of the following terms, which is not a principle of valuation?

Select one:
a. Anticipation
b. Substitution
c. Utility
d. Combination

Answer 1

Combination is not a principle of valuation; anticipation, substitution, and utility are the principles typically associated with property valuation.

Step-by-step explanation:

Of the options provided, combination is not a principle of valuation. The principles of valuation typically include anticipation, reflecting the belief that the value of property can increase or decrease based on the expectation of future benefits or losses; substitution, which holds that a prudent investor would not pay more for a property than the cost to acquire an equally desirable substitute property; and utility, which relates to the ability of a property to satisfy needs and wants of a user. The principle of combination, while related to enhancing the value of assets by combining them with other assets, is not traditionally considered one of the core principles of valuation in the same context as the others.