A buyer purchased 4.5 acres of land for $78,400. An adjoining owner wants to purchase a strip of this land measuring 150 feet by 100 feet. What should this strip cost the adjoining owner if it sells for the same price per square foot the buyer originally paid for it?

A buyer purchased 4.5 acres of land for $78,400. An adjoining owner wants to purchase a strip of this land measuring 150 feet by 100 feet. What should this strip cost the adjoining owner if it sells for the same price per square foot the buyer originally paid for it?

• A. $6,000
• B. $5,995
• C. $6,500
• D. $5,500

Answer: (A)

Pricing land by area means the cost scales with the amount of land, so you pay the same per-square-foot rate regardless of size. Start by converting the total land to square feet: 4.5 acres × 43,560 sq ft per acre = 196,020 sq ft. The price per square foot is $78,400 ÷ 196,020 ≈ $0.40 per sq ft. The adjoining strip is 150 ft by 100 ft, which is 15,000 sq ft. At the same unit price, the strip costs 15,000 × $0.40 ≈ $6,000 (rounding to the nearest dollar; the precise amount is about $5,999). So the strip should cost about $6,000.

Pricing land by area means the cost scales with the amount of land, so you pay the same per-square-foot rate regardless of size. Start by converting the total land to square feet: 4.5 acres × 43,560 sq ft per acre = 196,020 sq ft. The price per square foot is $78,400 ÷ 196,020 ≈ $0.40 per sq ft. The adjoining strip is 150 ft by 100 ft, which is 15,000 sq ft. At the same unit price, the strip costs 15,000 × $0.40 ≈ $6,000 (rounding to the nearest dollar; the precise amount is about $5,999). So the strip should cost about $6,000.