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A lease payment that increases based on a portion of the income received by a tenant is called a _______ lease.

a) Income lease
b) Fixed lease
c) Variable lease
d) Graduated lease

1 Answer

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Final answer:

A lease payment that increases with the tenant's income is called a percentage lease, commonly used in retail spaces which benefits both parties as it adapts with the business's revenue.

Step-by-step explanation:

A lease payment that increases based on a portion of the income received by a tenant is called a percentage lease. This type of lease agreement is common in retail spaces where landlords expect to benefit from the success of a tenant's business. In a percentage lease, the tenant pays a base rent plus a percentage of their monthly sales over a certain amount. This allows for a fluctuating rental payment that corresponds with the income of the business, which can be beneficial for both the tenant and the landlord.

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