What will be the new rent per square foot if a building's rent is adjusted from an index of 1.5 to 1.8?

To determine the new rent per square foot when an index is adjusted from 1.5 to 1.8, we can apply the adjustment factor concept.

The rent per square foot is directly proportional to the index. This means that if the index increases, the rent will also increase according to the same ratio.

First, we calculate the ratio of the new index to the old index:

1.8 (new index) divided by 1.5 (old index) gives us 1.2.

This calculation shows that the rent will increase by a factor of 1.2.

If we assume that the original rent per square foot corresponds to the index of 1.5, we can let the original rent be represented as the rent at that index. For example, if we were to assume the current rent is $20 per square foot at the index of 1.5, then the new rent can be calculated as follows:

New Rent = Original Rent x (New Index / Old Index) = $20 x (1.8 / 1.5) = $20 x 1.2 = $24 per square foot.

Thus, under this example, with the adjustment from index 1