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Carpenter Red Seal Exam Prep · Question

A construction company has historically underestimated the lumber costs for framing residential projects by an average of 8% due to fluctuating market prices. If a new project's initial lumber estimate is $35,000, and the company wants to ensure this historical underestimation is accounted for, what is the adjusted lumber cost that should be included in the estimate?

To account for an 8% historical underestimation, the initial estimate needs to be increased by 8%. This is calculated as $35,000 * (1 + 0.08) = $35,000 * 1.08 =

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Question: A construction company has historically underestimated the lumber costs for framing residential projects by an average of 8% due to fluctuating market prices. If a new project's initial lumber estimate is $35,000, and the company wants to ensure this historical underestimation is accounted for, what is the adjusted lumber cost that should be included in the estimate?

Answer options:

  • $35,000.00 ✅ $37,800.00
  • $32,200.00
  • $38,900.00

Correct answer: $37,800.00

Explanation: To account for an 8% historical underestimation, the initial estimate needs to be increased by 8%. This is calculated as $35,000 * (1 + 0.08) = $35,000 * 1.08 = $37,800. This adjusts for the known variance.

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