Using mutually exclusive active and pending statuses in the same competitive segment, there are 42 pending contracts and 210 active listings. What pending-to-active percentage results? This differs from pending/(pending+active).
Correct Answer
B) 20 percent
Pending-to-active percentage=42/210×100=20%. This is the stated sample measure, not an automatic market-condition classification or value adjustment. Common errors: dividing by pending plus active gives 17 percent; inverting the ratio (active ÷ pending) gives 500 percent; reporting the complement instead of the percentage gives 80 percent.
Why This Is the Correct Answer
Option B is correct because the pending-to-active percentage is 42 / 210 x 100 = 20%. The denominator is active listings only, as the stem specifies.
Why the Other Options Are Wrong
Option A: 17 percent
Option A, 17 percent, comes from dividing by pending plus active: 42 / (42 + 210) x 100 = 42 / 252 x 100, about 17%. The stem asks for pending to active, 42 / 210 x 100 = 20%.
Option C: 80 percent
Option C, 80 percent, reports the complement: (210 - 42) / 210 x 100 = 80%. The requested measure is 42 / 210 x 100 = 20%.
Option D: 500 percent
Option D, 500 percent, inverts the ratio as active over pending: 210 / 42 x 100 = 500%. The correct figure is 42 / 210 x 100 = 20%.
Pending on top, active below
"Pending-to-active" reads as pending divided by active. The word after "to" is the denominator.
How to use: Use this reading rule for any "X-to-Y" ratio in a market question.
Exam Tip
Note any definition the stem contrasts with the requested one; the contrasted measure often appears as a distractor. Here 17 percent is that alternate measure.
Common Mistakes to Avoid
- -Including pending contracts in the denominator
- -Inverting the ratio to active over pending
- -Reporting the complement instead of the percentage
Concept Deep Dive
Analysis
This question tests calculating a pending-to-active percentage. The measure divides pending contracts by active listings and converts the result to a percentage. The stem distinguishes it from pending over pending plus active, which is a different measure.
Background Knowledge
Pending sales relative to active listings can show how quickly current inventory is being absorbed. Different definitions, such as pending over active versus pending over pending plus active, give different results, so the definition must be applied consistently. The measure is an indicator, not an automatic value adjustment.
Real-World Application
An appraiser pulls MLS data showing 42 homes under contract and 210 active in a price band. She reports a 20% pending-to-active figure and compares it with prior periods to judge whether demand is strengthening.
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