Todd Lindsey & Associates,a commercial real estate company located in Boston,owns six office buildings in the Boston area that it leases to businesses.The lease price per square foot differs by building due to location and building amenities.Currently,all six buildings are fully leased at the prices shown here. Compute the weighted average (mean)price per square foot for these buildings.

Question

Todd Lindsey & Associates,a commercial real estate company located in Boston,owns six office buildings in the Boston area that it leases to businesses.The lease price per square foot differs by building due to location and building amenities.Currently,all six buildings are fully leased at the prices shown here.  Compute the weighted average (mean)price per square foot for these buildings.

Quizplus · Accepted Answer

To calculate the weighted average mean, we need to multiply each lease price by the proportion of the total area leased for each building and then sum these products. We do not have information about the area leased for each building, so we cannot calculate the weighted average exactly. However, we can use the lease prices as weights since they reflect the relative value of each building's location and amenities. Thus, the weighted average is:

(60 x 80 + 40 x 82 + 70 x 85 + 80 x 87 + 50 x 82 + 90 x 82) / (60 + 40 + 70 + 80 + 50 + 90) = 83.25

Therefore, the best choice is B, which is the closest to our calculated weighted average.

Todd Lindsey & Associates,a Commercial Real Estate Company Located in Boston,owns