Since the Architect Can Be Involved in Various Stages of the Development

question 4

Multiple Choice

Since the architect can be involved in various stages of the development process, there are a number of methods used to compensate him for his services, each of which may depend on the particular phase of development. If the architect provides pre-design services or schematics early in the development process, he will typically be compensated:

• A) on an hourly basis
• B) as a percentage of construction expenses
• C) by a fixed fee plus expenses
• D) only if he stays on the project through completion of the construction phase

---

Definitions:

Gross Margin

The variance between the revenue generated from sales and the cost incurred from goods sold, calculated as a fraction of the sales revenue.

Net Operating Income

The total profit of a company after operating expenses are subtracted from operating revenues.

Margin

Describes profit as the difference between sales and the costs of goods sold, often expressed as a percentage of sales.

Return on Investment

A measure of the profitability of an investment, calculated as the net gain from an investment divided by the cost of the investment.