Question

Natalie wants to make a 25% profit on her $70,000 land investment (there is no mortgage). She figures agents charge a 6% commission, and that closing costs will be an additional $1,200. What should she accept as a final sale price (to the nearest hundred)?

Answer 1

Natalie wants to make a 25% profit on a $70000 sale. That would be:

(125 ÷ 100) × 70000 = $87500.

Natalie wants to make $87500. But the agent would charge a 6% for the sale, Natalie will add a 6% to the $87500, that would be:

(106 ÷ 100) * 87500 = $92750.

On this $92750, there's a closing cost of $1200,

Add $92750 + $1200 = $93950.

$93950 to the nearest hundred will be $94000.

Natalie should make the final sale price $94000 in order to make a profit of %25.

Answer 2

Final sale price = $94000

Step-by-step explanation:

Price of investment = $70000

Profit accrued on investment = 1.25 * $70000= 87500

Agent commission= 6%

Agent commission = .06 * 87500

= $5250

Additional fee = 1200

Final sale price = $87500 +1200 + 5250 =93950 =$94000(nearest hundred)