A developer of a new townhome community has gathered the following market information for University City. The developer estimates that there will be 1,200 home (all types) sales in University City over the next year. An analysis of demographic information has revealed that the core market share for the townhome project within the community is 10%. Assuming a capture rate of 20%, what is the developer's first year projection of townhome sales in the new community?
A) 24 units
B) 120 units
C) 240 units
D) 600 units

Question

Quizplus · Accepted Answer

The developer's first year projection of townhome sales is calculated as follows: 1,200 home sales * 10% core market share = 120 potential sales. Then, 120 potential sales * 20% capture rate = 24 units.

A Developer of a New Townhome Community Has Gathered the Following