Suppose that a candy maker owns a building and is renting part of the building's space to a spa. Further suppose that because the candy maker is the owner, he has the right to make noise during the day while he makes candy. While the spa cannot insist on a quiet environment, it could move to a quieter building. However, rent in the next best building is $300/month more than rent in the noisy building. The candy maker can adopt a new technology that eliminates the noise for $225/month. Given this situation, can the spa find a private solution with the candy maker that will make both better off?

Question

Jamarcus Mayo

Business

4 February, 11:53

Suppose that a candy maker owns a building and is renting part of the building's space to a spa. Further suppose that because the candy maker is the owner, he has the right to make noise during the day while he makes candy. While the spa cannot insist on a quiet environment, it could move to a quieter building. However, rent in the next best building is $300/month more than rent in the noisy building. The candy maker can adopt a new technology that eliminates the noise for $225/month. Given this situation, can the spa find a private solution with the candy maker that will make both better off?

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Answers (1)

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Hallie · Answer 1

Yes, the spa can pay candy maker between $225 to $299 to adopt new noise elimination technology.

Explanation:

The candy maker is making noise while operating while a spa needs peace to operate.

The spa cannot insist the candy maker as he is the owner of the building.

The spa can move to a quieter place but the rent there is $300 more.

There is a new noise elimination technology that candy maker can use at a cost of $225.

The spa owner will be benefited if it makes a private solution by paying the candy maker to adopt new technology.

The spa can pay something between $225 and $299.

This will be beneficial to both of them. For the candy maker the cost of new technology will covered. For the spa it will be able to operate in peace without paying $300 more as rent.