Two parcels of land are exchanged. The first parcel is the NW ¼ of the SE ¼ of Section 21 and is valued at $800 per acre. The second parcel is the S ½ of the NE ¼ of Section 22 and is valued at $500 per acre. What is the difference in value between the exchanged properties?
A. $8,000
B. $8,800
C. $12,000
D. $24,000
Answer: A. $8,000
Explanation: First, calculate the area of the first parcel (640 acres ÷ 4 = 160, and 160 acres ÷ 4 = 40 acres). Multiply that by $800 per acre to find that the first parcel is valued at $32,000 (40 × $800). Next, calculate the area of the second parcel (640 acres ÷ 4 = 160, and 160 acres ÷ 2 = 80 acres). Multiply that by $500 per acre to find that the second parcel is valued at $40,000 (80 × $500). Subtract $32,000 from $40,000 to find that the difference is $8,000.
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