Sign up  |  Log in

The Four-Quadrant Model

Can someone explain this answer to me from TestBank of Uppermark?

“If there is no change in the stock of space in the southeast quadrant of the four-quadrant real estate model, which of the following most accurately represents the amount of stock of space?

Answer: construction C divided by depreciation rate d

Explanation: When change in stock of space S is zero (i.e., DS = 0), then S = C/d.”

I dont understand why we are dividing the Construction  with the depreciation rate. 

Schweser's 2019 PremiumPlus™ and Premium packages are 20% off when you order by June 13, 2019.

It’s down to the given formula: 

Change Stock of Space = Construction - (Depreciation x Amount of Stock of Space) 

Change S = C - dS

If Change S = 0 then… 

0 = C - dS

dS = C

S = C/d