Suppose a developer is interested in building a new townhome community. Through his market research, the developer has determined that the target market makes up 10% (core market share) of the households that currently reside in the metropolitan area. If an analysis of data from the MLS indicates that there should be approximately 500 residential sales in this area over the next year, what is the projected number of units the developer could expect to sell in year 1 if he is able to capture 50% of the market potential?
A) 500 units
B) 250 units
C) 50 units
D) 25 units

Question

Quizplus · Accepted Answer

The target market is 10% of the households, and if the developer captures 50% of this market, then the expected sales are 5% of the 500 residential sales, which equals 25 units.

Suppose a Developer Is Interested in Building a New Townhome