CA Broker Exam - Computrainer Exams 1-9 Flashcards

CA Broker Exam - Computrainer Exams 1-9 Flashcards

Question: A prospective purchaser obtained a four-month

option on a parcel of real property by paying $200 to the owner. All of the following are true except:A: The optionee

has created a legal interest in the property;B: The optionor

is totally restricted by having received a "valuable"

consideration;C: The agreement imposes no obligation on

the optionee to purchase the property;D: A unilateral

contract has been created.

Correct Answer is : AAn option is not an interest in

property, it is a unilateral contract in which the optionor is bound, but the optionee is not.

Question: Of the following, which is correct concerning past

and/or future depreciation:A: The cost to cure method of estimating depreciation is mainly concerned with future

depreciation;B: The straight line method may be used to

measure past or future depreciation;C: The income

approach provides for accrued depreciation in projecting

net income into the future;D: The cost approach is

concerned with accruals for past and/or future depreciation.

Correct Answer is : BThe cost approach is concerned with

accrued depreciation (past); the income approach would not project past depreciation (accrued); the cost to cure method is concerned with past depreciation, not future.However, the straight line method can be used to calculate either past or future depreciation.

Question: In an easement appurtenant, the dominant

tenement:A: May transfer the easement rights independent

of the land;B: May not retain the easement rights if the

dominant tenement is transferred;C: May use the easement

rights for purposes of ingress and egress only;D: Receives

the burdens and the benefits of the easement.

Correct Answer is : BIn an easement appurtenant, the

owner of the dominant tenement may not retain the easement rights if the property is transferred. The rights of the easement would automatically transfer to the new owner.

Question: When the term "warehousing" is used in

connection with real property financing, the term would normally describe:A: A jumbo loan on a self-storage

facility;B: The underwriting of stock issues with loans

against industrial property;C: Loans regulated by Division 7

of the California Real Estate Law;D: A mortgage banker

collecting loans prior to sale.

Correct Answer is : D"Warehousing" is the term used to

describe the activity of collecting loans prior to re-sale of those loans to a large institutional investor.

Question: Which of the following statements concerning the

methods of appraising land is most nearly correct:A: The abstractive method analyzes the income imputable to the land and abstracts the value of any mineral rights held by

others;B: The land residual method values the total

property on the basis of market comparison and subtracts

the cost of the improvements;C: The development method

estimates the total value of land and improvements when

sold and deducts the development costs;D: The

comparative method compares the value of the improvements and the value of the land both together and separately.

Correct Answer is : CBy definition

Question: Which of the following are necessary for a real

property conditional installment sales contract to be valid:A: Consideration, offer and acceptance, mutuality, competent

parties, legally sufficient writing;B: Consideration, offer and

acceptance, expressed time element, price;C: Lawful

object, competent parties, offer and acceptance, legally

sufficient writing;D: Consideration, offer and acceptance,

lawful object, competent parties, legally sufficient writing.

Correct Answer is : D (CoaLc)The four legal essentials in

any contract are: (1)consideration; (2) an offer and

acceptance (i.e., a meeting of the minds); (3) a lawful object; and (4) competent parties. In addition, in most real estate transactions, a fifth essential, required by the Statute of Frauds, is that there be a legally sufficient writing.

Question: In contrasting conventional and FHA loans,

historically FHA loans:A: Are processed faster;B: Provide

for more flexible terms;C: Require a larger down

payment;D: Require smaller monthly principal payments.

Correct Answer is : DSince FHA loans are for a longer

period of time, the monthly principal payments would be smaller.

Question: An application for a subdivision public report

must state the degree of flood hazard, if any, which exists.The degrees of flood hazard are:A: Inundation, sheet

overflow, and ponding of local storm water;B: Accretion,

alluvium, and avulsion;C: Frequent, infrequent, and

remote;D: Below flood stage, flood stage, and above flood

stage.

Correct Answer is : AThe degree of flood hazard is

classified as inundation, sheet overflow, or ponding.

Question: Accepted methods of appraising land are all of

the following, except:A: Comparative method;B: Economic method;C: Abstractive method;D: Development method.

Correct Answer is : BThe comparative method would

compare the value of one parcel with another; the abstractive method would abstract from the total value of the property the value of the improvements, and hence the remaining value would be the value of the land; the development method estimates the value of the property when fully developed and subtracts the development costs, thus indicating the value of the land.

Question: Which of the following would be used to transfer

a title or interest in trade fixtures when selling a business:A: A negotiable instrument;B: A chattel real;C: A bill of sale;D: None of the above.

Correct Answer is : CA bill of sale is used to transfer

ownership of personal property.

Question: The recording of a conditional/installment land

sales contract on real property is:A: Possible only when the

contract has been acknowledged by the vendee;B:

Especially desirable for a vendee who does not take

possession of the property;C: Impossible without the

seller's prior approval;D: Always advantageous to the

seller.

Correct Answer is : BA vendee who does not take

possession of the property would be offered some measure of protection by the recording of the contract. Recording requires the signatures and acknowledgement of both vendor and vendee; recording sometimes creates inconvenience for the vendor (the seller).

Question: The disclosure statement which is required under

the Truth-in-Lending Act would include:A: A list of the items

that are included in the finance charge;B: A description of

the security interest held by the lender;C: The annual

percentage rate;D: All of the above.

Correct Answer is : DThe law provides for inclusion of

statements "A," "B" and "C"; hence, item "D" is correct.

Question: Which of the following is responsible for the

availability of paved streets, public utilities, curbs and

gutters in new subdivisions:A: The bonding company

servicing the developer;B: Improvement districts formed by

lot purchasers;C: The city or county planning office;D: The subdivider/developer.

Correct Answer is : DIt is the responsibility of the

developer/subdivider to assure the availability of such items

as paved streets, public utilities, curbs, gutters, sidewalks, etc., in new subdivisions.

Question: Certain forms of real estate syndication are

preferred by knowledgable investors because of limited liability to the investors and because of the flow-through to investors of certain tax deductions. Which of the following forms of syndication is so preferred:A: Publicly-traded stock corporation;B: Limited partnership;C: Real estate

investment trust;D: Joint venture.

Correct Answer is : BOf the forms of syndication listed, a

limited partnership offers the benefits sought.

Question: Jones and Hanson own adjacent parcels of real

estate. Jones tells Hanson: "You may cross my property

until I tell you to stop." What type of interest does Hanson have in Jones' property:A: An easement in gross;B: An easement at will;C: A license;D: A right-of-way easement.

Correct Answer is : CBecause it is personal and revocable,

it is not an easement. Hence, it would be classified as a license.

Question: An indirect method of estimating depreciation

would include which of the following:A: Engineering;B: Capitalized income;C: Age-life;D: Breakdown.

Correct Answer is : BCapitalized income is an indirect

method of estimating depreciation.

Question: Mike Coogan, a new real estate salesperson,

made strong efforts to obtain listings in a non-integrated community. He found success by insinuating to property owners that should minorities move into the area, the value of their homes would decrease. Which of the following terms best describes the activities of Salesperson Coogan:A: Steering;B: Panic peddling;C: Blockbusting;D: Both "B" and "C".

Correct Answer is : DSuch activity is described as both

panic peddling and blockbusting.

Question: One holding a valid California real estate license

is legally entitled to act as agent in the purchase or sale of:A: Any mobile homeB: A new mobile homeC: Any mobile

home that is at least 8 feet wide and 40 feet longD: A

registered mobile home

Correct Answer is : DA California licensee can act as agent

in the sale of a used (registered) mobile home.

Question: When a listed property is located within a certain

flood zone area, which of the following flood zone areas require disclosure of that fact by the seller or seller's agent:A: Special flood zone areaB: Areas of moderate flood hazardC: Areas of minimal riskD: All of the above

Correct Answer is : ASpecial flood zone areas (100-year)

must be disclosed to potential buyers.How to calculate Gross Rent Multipliermonthly/annual gross rent divided by the selling price

Question: In the event of unpaid business debts, which of

the following are personally liable:A: Limited partners in a limited partnership;B: Members of a general partnership;C:

Stockholders in a corporation;D: None of the above.

Correct Answer is : BMembers of a general partnership are

personally liable for the debts of the business.

Question: The unit of comparison method of estimating the

cost new of a structure involves:A: Lumping together the cost of all components of the structure on a unit basis, such