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QUESTION 1

 

If you knew the original purchase price, you could multiply that times 22%, and subtract that amount from the purchase price, OR you could look at the FULL original purchase price as being 100% of that amount, of which you lost 22% when you resold it.  You now have 78% of the original amount, so you could multiply the original price by 78% and get the new amount, which is $88,000.  If you are STARTING at the 88,000, you have to do the OPPOSITE to get back to the original amount, meaning you need to DIVIDE by 78%, which will give you $112,820.51 (c).     Go back to quiz      Go to Explanations

 

QUESTION 2

 

So you’re asking, “What does this have to do with real estate?”  Well, where do you think the wood is located?  Anyway, this is cross-multiplying with a twist (the time period is different).  Twenty cords in two days would be ten in one day.  Then Go back to quiz      Go to Explanations

 

 

 

QUESTION 3

 

If you did this in the order that things really happen, you would start at the sale price.  The commission gets paid first (that’s the way it should be); THEN you subtract the closing costs and the mortgage, which will net the seller $70,000.  Also, the commission percentage will tell us what the BROKER is getting (10% of the sale price).  That means the seller is getting 90% of the sale price before the other things are taken out (100% - 10% = 90%).  In a formula it would appear as the following:

(We’ll call the sale price “SP”)  SP x 90% - 4000 – 93,000 = 70,000.  When you go in reverse, you have to keep the same order and numbers, but do the opposite function.  The LAST thing we did was SUBTRACT 93,000 to get 70,000, so in reverse we need to start at 70,000, and ADD the 93,000 back in FIRST.  The full formula would be:

70,000 + 93,000 + 4000 divided by 90% = SP (Which is $185,555.55).         Go back to quiz      Go to Explanations

 

QUESTION 4

 

This must be worked backwards.  It may be easiest to put it in order first. First, if the selling broker gets 40%, that means the listing broker gets 60% (100% - 40%).  Then going forward, SP x 8% x 60% x 52% = $2300.  Going forward we multiplied at every step along the way and ended at 2300.  Going backwards we’ll start at 2300 and work our way back to the sale price.  When we go backwards we have to do everything the opposite, so we will divide at every step.  2300 divided by the salesperson’s 52% will give us the broker’s commission of  $4,423.08.  4423.08 divided by 60% will give us the total commission of $7,371.79.  7371.79 divided by 8% will give us the sale price of $92,147.43 (or .44 depending on your calculator).                                                                                                       Go back to quiz       Go to Explanations

 

 

QUESTION 5

 

Work this out.  You are NOT taking the same 10%.  140,000 x 10% = 14,000; 140,000 + 14,000 = 154,000 (or you could just have done 140,000 x 110%); 154,000 x 10% = 15,400 (see, it’s a different number); 154,000 – 15,400 = 138,600 (or you could have just done 154,000 x 90%).                                                       Go back to quiz       Go to Explanations         

 

 

QUESTION 6   

 

If you lost 14%, that means you have only 86% of what you originally had (100% - 14% = 86%).  IF you knew the original amount, you could multiply by 86% and get $98,000.  Since you are going backwards, you would do the opposite (the 14% is of your original amount, NOT the 98,000 dollars).  So, $98,000 divided by 86% will give you $113,953.48.

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QUESTION 7  

 

This is a trapezoid.  140 + 380 divided by 2 = 260; 260 x 190 = 49,400; 49,400 x $3.50 = $172,900; 172,900 x 8% = $13,832.  If the selling broker gets 45%, then the listing broker gets 55%.  13,832 x 55% = $7607.60

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QUESTION 8

 

Using the factor chart, 30 years at 7.75% gives us a factor of  7.16.  Since it is a $119,500 loan, we would divide that by a thousand and multiply the factor by 119.5.  7.16 x 119.5 = $855.62, which would be our monthly payment for principal and interest on the 30 year loan.  15 years at 7.5% would give us a factor of 9.27.  9.27 x 119.5 = 1107.77, which would be our monthly payment on the thirty-year loan.  1107.77 – 855.62 = 252.15, which would be the difference in our payments.

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QUESTION 9

 

Again using the factor chart, 20 years at 8% gives us a factor of 8.37.  The 750 dollar payment divided by the factor of 8.37 will give us 89.605734 (Do NOT round off until the end).  89.605734 x 1000 gives us a loan amount of $89,605.73 (Now we have to round off).  THEN ADD the $12,000 dollar downpayment to the loan amount to get the total purchase price of $101,605.73, which is not up there (Mmm, must be none of the above).          Go back to quiz       Go to Explanations

 

QUESTION 10

 

$180,000 x 40% gives us an assessed value of $72,000.  Since the rate is in dollars per hundred, we have to divide that by 100, to get 720.  720 times the rate of $2.80 gives us a tax of $2016.              Go back to quiz       Go to Explanations

 

QUESTION 11

 

The loan is 90% of the sale price, so $124,900 x 90% = $112,410.  One point is 1% of the LOAN amount or $1124.10, so 3 points would be $3372.30. .  The commission is based on the sale price, so $124,900 x 8% = $9992.  3372.30 + 9992 + 2100 = 15,464.30, which would be our total closing costs.                               Go back to quiz       Go to Explanations

 

QUESTION 12

 

Interest rates are based on 1 year, so we first need to multiply our monthly interest by 12 to get 1 year’s worth of interest, or $5040.  5040 divided by our rate of 8% will give us our loan amount of $63,000.

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QUESTION 13

 

$90,000 x 45% = $40,500 assessed value.  The tax of $1400 divided by the $40,500 assessed value gives us a rate of .03457 or 34.57 mills.                                                                                   Go back to quiz       Go to Explanations

 

QUESTION 14

 

300 x 5280 = 1,584,000.  1,584,000 divided by 43,560 is 36.36 acres.

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QUESTION 15

 

This is cross-multiplying again.  It’s easiest to keep this in minutes.

81 and 2/3 minutes is 1 hour, 21 minutes and 40 seconds.

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2000 Douglas R. Barry