How can the commission rate be calculated from commission dollars and sale price?

The commission rate can be calculated by dividing the total commission dollars earned by the sale price of the property. This calculation provides a percentage that represents how much of the sale price is made up by the commission.

For example, if a property sells for $200,000 and the commission earned is $10,000, the commission rate would be calculated as follows: $10,000 (commission) divided by $200,000 (sale price), which equals 0.05 or 5%. This percentage indicates the portion of the sale price that the commission represents and gives a clear understanding of the compensation structure involved in the transaction.

The other options do not accurately represent how to derive the commission rate from the commission dollars and sale price, thus reinforcing why this method is valid and useful for real estate calculations.