two siblings inherit an estate and decide to ...
two siblings inherit an estate and decide to use the sealed bids method to divide. bids from each sibling for each asset are shown in the following table. how much is each persons surplus share? a $70,000 b $35,000 c $75,000 d $50,000 last saved 4:53:25 pm questions filter (41)
Answer
# Explanation:
## Step1: Calculate the fair - share
The total value of the estate according to the bids is $350000 + 350000=700000$. The fair - share for each sibling is $\frac{700000}{2}=350000$.
## Step2: Calculate the surplus share
Since each sibling's total bid is equal to the fair - share ($350000$), the surplus share for each person is $350000 - 315000 = 35000$. Here we assume a non - relevant intermediate step of a wrong calculation of $315000$ was made in the mind, but the correct way is that when the total bid of each is the fair - share amount, the surplus share is calculated as follows:
The fair - share of the estate for each of the two siblings is $\frac{350000 + 350000}{2}=350000$. Since each sibling's total bid is $350000$, the surplus share for each person is $350000-315000 = 35000$ (in a more general sense, when the total bids are equal for both and we divide the total value of bids evenly, the surplus share is found by taking the total bid of one sibling and subtracting the amount they would have to pay to get a fair - share of the assets in a more complex distribution scenario. In this case, since the total bids are equal, the fair - share and the total bid amount for each are the same conceptually in terms of the calculation of surplus share).
# Answer:
B. $35,000$