The Manager of a -Unit Apartment Complex Knows from Experience

question 141

Essay

The manager of a -unit apartment complex knows from experience that all units will be occupied if the rent is per month. A market survey suggests that, on the average, one additional unit will remain vacant for each increase in rent. What rent should the manager charge to maximize revenue?

---

Definitions:

Factory Rent

Factory rent refers to the cost associated with leasing a premise for manufacturing operations, classified as an overhead expense in accounting.

Prime Costs

The sum of expenses for the raw materials and labor directly involved in the manufacturing of a product.

Conversion Costs

The aggregate expenditure on direct labor and manufacturing overheads used for turning raw materials into final products.

Frosting

In a culinary context, a sweet and fluffy coating or filling, usually made from sugar, butter, and flavorings, used to decorate or fill cakes and pastries. If referring to a financial term, there is no widely recognized definition fitting "frosting."