Question

Two parcels of land are exchanged. The first parcel is the NW 1/4 of the SE 1/4 of Section 21 and is valued at $850 per acre. The second parcel is the S 1/2 of the NE 1/4 of Section 22 and is valued at $650 per acre. What is the difference in value between the exchanged properties?

Select one:

a. $8,000

b. $12,000

c. $18,000

d. $8,800

Answer 1

Option C - $18000

You always start with 640 acres and solve by dividing from right to left

Valuation of First parcel

= 640 acre * SE 1/4 = 160 acres

then 160 acres * NW 1/4 = 40 acres

Valuation = Acres * Rate per acres = 40 * 850 = $34000 for first parcel

Valuation of Second parcel

= 640 acre * NE 1/4 = 160,

then 160 acres * S 1/2 = 80 acres

Valuation = Acres * Rate per acres = 80 * 650 = $52000 for second parcel

Difference in value if property is exchanged

= Valuation of second parcel - Valuation of first parcel

= $52000 - $34000

= $18000