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A prospective residential tenant offers the owner/landlord a lower rent claiming his family does not use a lot of utilities so the landlord will be saving money. Landlord finds this offer interesting but does not want to lock itself into a potentially costly lease arrangement. The landlord counters with a lower rent and the tenant will reimburse (pay) the landlord for the gas, electric and sewer/water consumed. The parties agree to this arrangement and will enter into a lease. A. Answer this question for a property in the City of Chicago and one outside Chicago. B. Is this legal and may the parties enter into a valid lease for this arrangement? If yes, why? If no, why not? C. What are the negatives of this proposed lease – explain problems from both the landlord’s and the tenant’s prospective.

Operation Management, Management Studies

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