Assignment

You are a real estate developer and are trying to determine the EMV of your net commission from a sales call to a potential purchaser.

Assume that your transportation cost is $1.45 per mile Assume that the sales call is 70 miles round trip

Assume that your transportation time is 2.25 minutes per mile

Assume that the value of your time for transportation is $55.00 per hour Assume that it will take 3 hours to meet with the potential purchaser

Assume that the value of your time for the customer meeting is $150.00 per hour Assume that you will have a 19% chance of a successful sales call (sales call #1)

If sales call #1 is successful,you will sell a house valued at $275,000 with likelihood = 55% you will sell a house valued at $300,000 with likelihood = 35% you will sell a house valued at $425,000 with likelihood = 10%

Assume that your commission will be 2.5% of the value of the house if sales call #1 is successful.

  1. a) What is the expected cost (time and transportation) of sales call #1?
  2. b) Without assuming that the sales call will be successful (that is, it may or may
  3. not be a success), what is the expected gross commission of sales call #1 (do not net out the expected costs)?

Suppose you have a second possible sales call (sales call #2). Assume that the expected cost remains the same and that the commission rate remains 2.5%, but that the following information is the different information for sales call #2.

Assume that you will have a 12% chance of a successful sales call (sales call #2) If sales call #2 is successful,

you will sell a house valued at $285,000 with likelihood = 45% you will sell a house valued at $320,000 with likelihood = 25% you will sell a house valued at $355,000 with likelihood = 30%

c) Assuming that your sales call is successful, which sales call is the maximin sales call? (Don’t simply define maximin, but use values to justify your response).

 

Order a unique copy of this paper
(550 words)

Approximate price: $22

Basic features
  • Free title page and bibliography
  • Unlimited revisions
  • Plagiarism-free guarantee
  • Money-back guarantee
  • 24/7 support
On-demand options
  • Writer’s samples
  • Part-by-part delivery
  • Overnight delivery
  • Copies of used sources
  • Expert Proofreading
Paper format
  • 275 words per page
  • 12 pt Arial/Times New Roman
  • Double line spacing
  • Any citation style (APA, MLA, Chicago/Turabian, Harvard)

Our guarantees

Our customer is the center of what we do and thus we offer 100% original essays..
By ordering our essays, you are guaranteed the best quality through our qualified experts.All your information and everything that you do on our website is kept completely confidential.

Money-back guarantee

You have to be 100% sure of the quality of your product to give a money-back guarantee. This describes us perfectly. Make sure that this guarantee is totally transparent.

Read more

Zero-plagiarism guarantee

The paper ordered is very original. Orders are checked by the most advanced anti-plagiarism software in the industry which ensures that the the essay written is 100% original. In that regard,we have a zero tolerance policy for plagiarism.

Read more

Free-revision policy

Our Company thrives on excellence and thus we help ensure the Customer’s total satisfaction with the completed Order.To do so, we provide a Free Revision policy as a courtesy service. To receive free revision the Company requires that the Customer provides the request within Fifteen (15) days from the first completion date and within a period of thirty (30) days for dissertations and research papers.

Read more

Privacy policy

The Company is committed to protect the privacy of the Customer and it will never resell or share any of Customer’s personal information, including credit card data, with any third party. All the online transactions are processed through the secure and reliable online payment systems.

Read more

Fair-cooperation guarantee

By placing an order with us, you agree to the service we provide. We will endeavor to do all that it takes to deliver a comprehensive paper as per your requirements. We also count on your cooperation to ensure that we deliver on this mandate.

Read more

Calculate the price of your order

550 words
We'll send you the first draft for approval by September 11, 2018 at 10:52 AM
Total price:
$26
The price is based on these factors:
Academic level
Number of pages
Urgency