REAL ESTATE EXAM MATH - PERCENTAGES BASICS

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IMPORTANT RULES

PERCENTAGES IN REAL ESTATE EXAM RULE 1


Percentages should be in decimal form when performing calculations.

For example: 79% = 0.79

2% = 0.02

125% = 1.25


HOW DO YOU GET THE DECIMAL POINT FROM ?

Divide the percent number by 100


EXAMPLE

When given 7% in a problem , convert right away to this form :

7 ÷ 100 = 0.07


RULE 2

Don't Leave your Answer in decimal form when asked to give a Percentage answer.

(Unless the multiple choices are in Decimal Form)


For example:

HOW DO YOU GET PERCENTAGE FORM IF YOU HAVE DECIMAL POINT FROM ?

Multiple the Decimal Form by 100


EXAMPLE

When given 0.07 in a problem or when your answer from your calculator shows up as 0.07, convert right away to Percentage by:

0.07 x 100 = 7%


Commission Percentages


Type 1

Commission Earned Percentages

Sale price × commission rate = commission earned


Example 1 : You’re a an agent who sells a house. Sarah, the owner, has agreed to pay you a 5 percent commission. How much will you earn on the sale, if the house sells for $600,000?


Step 1 : Convert 5% to Decimal Form

5 ÷ 100 = 0.05


Step 2 : 600,000 x 0.05

ANSWER = $30,000


Type 2

What was your Commission Rate( rule 2 applies here)

Commission earned ÷ sale price = commission rate


Example 1 : Joe sold a listed house for $400,000. He earned a $20,000 commission on the sale. What was his commission rate?


Commission earned ÷ sale price = commission rate

Step 1: $20,000 ÷ $400,000 = 0.05


Step 2: 0.05 x 100

Answer = 5%



DIFFERENT TYPES OF COMMISSION QUESTIONS ON THE REAL ESTATE EXAM

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