when real estate agents sell their own, rather than clients', houses, they leave the houses on the market for a longer time (10 days longer onaverage) and wind up wth better prices.Suppose that real estate agents earn a commission equal to 3% of the sale value of each house that they help selI. Suppose a real estate agent hasan offer on a house of $600,000. The agent can get a 4% higher offer with more effort and by leaving the house on the market for a few more weeks.If the agent sells the house now, she will earn a commisslon of SBy keeping the house on the market and expending more effortto sell the house, the agent can earn a commisslon of $Thus, the agent galnsfor the extra effort and time ofkeeping the house on the market.Suppose a real estate aqent has an offer on a house that she owns. The agent has a curTent offer of $600,000, but can get a 4% higher offer withmore effort and by leaving the house on the market for a few more weeks. Assume that all of the commisslon Is pald back to the agent, since she willact as the agent for the sale.than what sheIf the agent walts to sell the house, she galnsmore than selling the house now. Since this amount Islikely to keep a house on thewould gain by walting to sell a house she does not own (as In the first part of the problem), the agent ismarket and expend more effort to sell a house that she owns, as opposed to one that she does not own.

Answered: Image /qna-images/answer/1e65daba-8c76-4505-b38e-3be1953cdb7d.jpg

Answered: when real estate agents sell their own,…

when real estate agents sell their own, rather than cllents', houses, they leave the houses on the market for a longer time (10 days longer on average) and wind up wth better prices.

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

See similar textbooks

Similar questions

A couple in their 70s with no liens on their home would like some extra income, but don't want to make monthly loan payments. What kind of loan might a lender offer them? A- A reverse equity loan, since they are over 62 and have sufficient equity in their home B A reverse equity loan, since they are over the age of 35 C- A reverse equity loan, but the couple will need to make monthly payments D - None; a lender will probably refuse to lend to anyone over the age of 62 -
It's urgently plz sir please help me
Pick only one option: The owner of Tommy's Technicians has found that his shop is losing money and he is in jeopardy of going out of business. Sales have remained constant for quite some time and now he is looking at ways to cut expenses to stay in business. Which of the following expenses is his best choice to try to immediately reduce and save him meaningful dollars so he can remain in business? (Hint: First consider which ones he has ultimate control over?) Rent expense Utilities expense Payroll expense Shop insurance expense Advertising expense
Problem # 45: In the center of a big city, the rent for a plot of land has a rental price of $600,000 per year. a. What is the minimum purchase price the owner will accept for this land if the prevailing interest rate is at 10% and assuming that it will remain at this rate most of the time? b. If the interest rate is expected to be lower at 5%, how much is the purchase price?
7 years ago, you bought an empty lot for $410893. Your plans have changed so you are thinking about selling it. You received an offer to purchase the lot for $613821. If you sell it at this price, what is the implied return? Answer:
Help me fast.....I will give good rating....
Sandy is nearing the end of her closed-end lease for her Ford Escape. She will not exceed her allocated miles and the car is in very good shape. Which lease component will amount to the total money she will have paid to the dealer? A : All the choices combined B : Capitalized cost reduction C : Rent charge D : Up-front fee
3. A real estate company is considering the investment on two types of apartments: condo apartments and two-bedroom apartments. The expected profits for the two types at different scenarios and the corresponding probabilities are shown in Table 3. Before starting to profit, the company should first invest on the two types of apartments for 20 billion RMB on A1 and 15 billion RMB on A2 respectively. Please decide by calculation which type of apartments is worth investing for this company? Table 3 Expected profits by different scenarios (The profits are in billion RMB Yuan) Expected Sale Forecast Good Normal Bad Types/Probabilities 0.5 0.3 0.2 Condo (A,) 50 25 15 Two-bedroom (Az) 80 0. -25 3/3 1L
Bathrooms and kitchens are typically the most important selling features of s home. Rouse Builders could differentiate the homes by upgrading the atmos and kitchens. The upgrades would cost $22,000 per home bur would enable Rouse Builders to increase the selling prices by $38.500 per home (Kitchen and bathroom upgrades typically add about 175% of their cost to the value of any home.) If Rouse Builders makes the upgrades, what will the new co-phus price per home be? Should the company differentiate in product in this manner?
With high market prices for homes, for many elderly Canadians, the most important source of retirement income will be the equity they have in their homes. A is a secured loan that allows older Canadians to generate income using the equity in their homes without having to sell this asset and in many cases, the mortgage does not have to be paid back until the death of the borrower. A Mortgage-Backed Security B Mortgage Stress Test C Mortgage Term D Reverse Mortgage E Conventional Mortgage
You were planning to purchase a house this month with a mortgage and just learned that the Fed is conducting open market purchase. Your situation is flexible in terms of the timing of the purchase; right now or later. It is assumed that everything else stays constant. What'd be the best strategy for your purchase? Explain using economic theory, not as a personal finance advisor
A businessman wants to set up a factory in an area. Now, The entrepreneur is looking for the best regional alternative that he thinks will profitable for his business, based on the survey results, area A has a probability of 0.8 to get a profit of IDR 5,000,000, if the company fails then will experience a loss of IDR 650,000. The second area is area B with 0.7 probability to get a profit of Rp. 5,500,000, if the company fail, you will get a loss of IDR 700,000. Based on this data, which locations are most advantageous?