Question

A parcel of land described as "the NW¼ of the SW¼ of Section 6, T4N, R8W of the Third Principal Meridian" was sold for $2,500 per acre. The listing broker will receive a 5 percent commission on the total sales price. How much will the broker receive?

Answer 1

To find the broker's commission, calculate the size of the land parcel, then the total sales price, and lastly the commission based on the sales price. In this case, the land parcel is 40 acres, the total sales price is $100,000, and at 5%, the broker's commission is $5,000.

Step-by-step explanation:

To determine the commission that the broker will receive from the sale of the land, we first need to calculate the total sales price of the parcel. The parcel of land is described as the NW¼ of the SW¼ of Section 6, T4N, R8W of the Third Principal Meridian. Each section is 640 acres, and the parcel is a quarter of a quarter-section, so it's 1/16 of a section.

To find the size of the parcel in acres, we multiply:

640 acres (size of a section) × ¼ (for the SW¼) × ¼ (for the NW¼) = 640 × ¼ × ¼ = 40 acres

Now, we can calculate the total sales price by multiplying the size of the parcel by the price per acre:

40 acres × $2,500/acre = $100,000 total sales price

Finally, we calculate the broker's commission by taking 5 percent of the total sales price:

$100,000 × 5% = $100,000 × 0.05 = $5,000 commission