Marketing Tools Concept Check 1 DON'T FORGET TO SHOW YOUR WORK! Jones Realty is a partnership of real estate agents who work in the Kent area. Jones Realty's revenue is based on the sale of houses. When one of the real estate agents sells a house, Jones Realty earns a 5% commission on the sale (meaning that 5% of the total selling price goes to Jones Realty). The real estate agent takes home 3%, and the remaining 2% goes to cover the costs of running the business. Jones Realty employs a full-time receptionist who works 40 hours a week and is paid $12.00 per hour. They pay rent on their offices of $1,000 per month, utilities for the offices of $400 per month, and carry an insurance policy that costs them $200 per month. 1. If Jones Realty sells a house for $250,000, what is their revenue from that house? 2. What do they pay the real estate agent who sold the $250,000 house? 3. Aside from what they pay their real estate agents, what does it cost Jones Realty to run their business every month (assume four weeks in a month)? 4. If this is the only house that Jones Realty sells this month, what is Jones Realty's profit for the month? 5. If Jones Realty sells twenty $250,000 houses per year, how much annual profit are they making? 6. The real estate agents at Jones Realty have been asking for an increase in their commission to 4% of the total selling price. Can Jones Realty afford to give them this raise? Do you think this is a good choice for Jones Realty? Write a paragraph explaining your decision