Understanding Lot Values in Arizona Real Estate

If a property sells for $205,000 and one lot is 40% less than the other, what is the total value of Lot A?

• A. $82,500
• B. $102,500
• C. $122,500
• D. $128,125

Answer: (A)

To determine the total value of Lot A when one lot is 40% less than the other, we first need to establish the relationship between the values of the two lots based on their selling price. Let’s denote the value of Lot B (the more expensive lot) as \( x \). Since Lot A is 40% less than Lot B, we can express the value of Lot A as \( x - 0.4x = 0.6x \). The combined value of both lots must equal the total property value of $205,000. Therefore, we can set up the equation: \[ x + 0.6x = 205,000 \] This simplifies to: \[ 1.6x = 205,000 \] To find \( x \), we divide both sides by 1.6: \[ x = \frac{205,000}{1.6} \] Calculating this gives: \[ x = 128,125 \] Now that we know the value of Lot B, we can find the value of Lot A. Since we have established Lot A is worth 60% of Lot B, we calculate Lot A’s value as

When it comes to diving into Arizona's real estate market, understanding how to calculate lot values isn't just a necessity—it's essential for anyone aspiring to pass their real estate license exam. You want to be confident in what you're doing, right? So, let’s break it down in a way that makes sense.

Imagine you come across a property selling for $205,000. Now, your task is to figure out the value of Lot A, which is actually 40% less than Lot B. It might seem like a tricky puzzle, but I promise it's just a matter of some simple math!

Let’s label the more expensive Lot B as ( x ). If Lot A is 40% less than Lot B, we can say Lot A’s value is ( x - 0.4x = 0.6x ). Simple enough, right? Now, combining the value of both lots gives us the equation ( x + 0.6x = 205,000 ). When we simplify that, we find ( 1.6x = 205,000 ). So, how do we isolate ( x )? We divide both sides by 1.6, and voilà—( x = \frac{205,000}{1.6} ). That leads us, quite neatly, to ( x = 128,125 ).

Now, if you were wondering about Lot A—40% less than Lot B translates to finding 60% of Lot B's value. Thus, Lot A equals 0.6 times 128,125, which calculates to $82,500. There you have it, folks: Lot A is valued at $82,500. Can you see how breaking it down like this turns a tricky question into a straightforward answer?

But let's not stop there! This kind of calculation is invaluable when you're out there negotiating deals or assessing properties. It not only helps in your understanding but also prepares you to tackle questions just like this on your Arizona Real Estate License Exam. Remember, real estate isn’t just about knowing prices; it’s about understanding the math that drives those prices. Whether it’s figuring the percentage differences or valuing properties based on their potential sale prices, being good with numbers makes you that much more credible in buyers’ and sellers’ eyes.

So, as you study, remember to embrace these calculations. Treat each question as an opportunity to engage with the material deeply. And who knows, these skills might not just help you pass the exam; they could also give you the upper hand in future real estate transactions! Regular practice with these concepts can turn that daunting exam into a manageable—and even exciting—challenge.

And let me ask you, isn't it a relief that once you break it down, math in real estate isn’t just a mountain to climb? It can be a path to your success in the field. Keep practicing these foundations, stay curious, and you'll find real estate becomes a territory you’re not just familiar with—but one you’re ready to conquer!