Florida Real Estate Practice Exam 2026 - Free Real Estate Practice Questions and Study Guide

Substitution is a well-known economic principle which states that the value of any property or good is determined by the cost of replacing it with a comparable substitute. This method is widely used in real estate and insurance industries to determine the value of a property or asset.

Option A, conforming value, is not a commonly known economic principle and is not a valid substitute for the concept of substitution.

Option B, similar cost principle, is also not a recognized economic principle.

Option C, regression, is a statistical method used to determine correlations between variables and would not apply to determining a property's value.

Overall, substitution is the most appropriate answer as it directly connects to the cost and replacement value of a property.