Florida Real Estate Broker ExaminationReal Estate CalculationsEasy
A real estate agent earns a 3.5% commission on the first $100,000 of a sale price and 2% on the remaining balance. If the agent sells a property for $450,000, what is their total commission?
- A$10,500
- B$12,000
- C$11,500
- D$13,000
Show answer & explanationAnswer & explanation
Correct answer: A. $10,500
Calculate the commission on the first $100,000 at 3.5% and then the commission on the remaining $350,000 at 2%. Add these two amounts to find the total commission.
Why the other options are wrong
- B. This could be a result of applying 2% to the entire sale price or other miscalculations.
- C. This might result from a calculation error on the remaining balance or percentage.
- D. This is likely a result of applying 3.5% to a larger portion than specified or other calculation errors.
Tiered Commission
A commission structure where different percentages are applied to different portions or tiers of the sale price.
- Calculated in segments.
- Common in real estate.
- Different rates for different price brackets.
Memory trick: Separate the tiers, then multiply and sum.