Prep Agent Practice Test Flashcards

Prep Agent Practice Test Flashcards

• You are preparing a competitive market analysis on a

vacant lot that you hope tolist for sale. Which of the following approaches to value will be used in thedevelopment of the estimated value?A. Cost approachB. Gross rent multiplierC. Income approachD.Sales comparison approach

• Sales comparison approach

During the term of an exclusive authorization and right to sell listing, the brokerhas his license revoked by the Bureau of Real Estate. To prove that he is entitled to acommission,

he must prove all of the following EXCEPT:A. He was

licensed at the time the commission was earnedB. The buyer and seller agreed to the sale during the listing termC.The broker was the procuring cause of the saleD. The listing was a legally binding agreement

• The broker was the procuring cause of the sale

In order for demand to be effective, it must be implemented

by:A. amenitiesB. locationC. highest and best useD.

purchasing power

• purchasing power

Given the subjective nature of market value, the listing

price is most likely:A. the lower end of the market valueB.

the average market valueC. the higher end of market valueD. not related to market value

• the higher end of market value

Two different properties are located side-by-side in the same neighborhood. Theywere both built by the same contractor, at the same time, for the same cost, aremaintained the same, and contain the same square footage. If one property is worthless than the other, it would

be due to:A. functional obsolescenceB. economic

obsolescenceC. deferred maintenanceD. physical deterioration

• functional obsolescence

An appraiser would most likely use a depth table when

confronted with avaluation problem involving:A.

capitalization of net incomeB. a sinking fundC. commercial propertyD. residential property

• commercial property

Most real estate contracts contain preprinted clauses or spaces for information tobe added in writing. In the

interpretation of such contracts:A. Printed parts take

precedence over the written partsB. The written parts and the printed parts are given equal considerationC. The written parts take precedence over the printed partsD. No changes or amendments to the printed clauses are permitted by law

• The written parts take precedence over the printed parts

Which of the following statements does NOT correctly describe a fiduciary?A. A fiduciary owes loyalty to the principalB. A fiduciary must conform to the principal's legal instructionsC. A fiduciary is an agentD. A fiduciary is a neutral third party

• A fiduciary is a neutral third party

The increase of value with the passage of time

describes:A. appreciationB. "return on" investmentC.

"return of" investmentD. depreciation

• appreciation

A tenant signs a lease that stipulates that the lessee pays

the property tax. Thislease is probably a:A. standard

leaseB. sandwich leaseC. net leaseD. reverse lease

• net lease

. Salesperson Beth took an offer to purchase from her buyer to Broker Smith's officeto present it. The offer included a $1,000.00 promissory note from the buyer as theearnest money deposit. Broker Smith should do which

one of the following uponreceipt of the offer:A. Tell Beth

she wasted her time and that he cannot accept the offer without cashor a check for the depositB. Tell Beth the note is not good enough because it did not come with a deedC.Tell Beth she should have called him first as not to waste her time, so he couldcall his seller to see if they would consider an offer with a promissory noteD. Tell Beth that a promissory note is just as good as cash or a check for thedeposit and present the offer to his seller

• Tell Beth that a promissory note is just as good as cash

or a check for thedeposit and present the offer to his seller The income approach would NOT be used when

appraising:A. commercial retail propertyB. residences in a

subdivisionC. industrial buildingsD. neighborhood shopping centers

• residences in a subdivision

A broker brought in an offer but the listing agreement did not include anauthorization to accept a deposit. Which of the following is correct?A. The authorization is impliedB.The broker cannot accept the depositC. If the broker accepts the deposit, he/she would do so as the agent of thebuyerD. None of the above

• If the broker accepts the deposit, he/she would do so as

the agent of the While the economy is experiencing inflation, interest

rates:A. drop and housing prices riseB. rise and housing

prices dropC. rise and housing prices riseD. None of the above

• rise and housing prices rise

A flight pattern to a nearby airport was changed so that planes pass over a singlefamilyresidential neighborhood.Any loss in value to these properties would beattributed

to:A. economic obsolescenceB. functional obsolescenceC.

physical obsolescenceD. All of the above

• economic obsolescence

Which of the following requires real estate listings to be in writing?A. Real Estate LawB. Statute of FraudsC. CARD.

None of the above

• Statute of Frauds

The measurement or the length of road that abuts a

thoroughfare is referred toas:A. front footB. frontageC.

widthD. the side of the parcel

• frontage

Wear and tear to the load bearing members of a building

would be classified as:A. functional

obsolescence-curableB. physical deterioration-curableC.functional obsolescence-incurableD. physical deterioration-incurable

• physical deterioration-incurable

The subjective value of a property is the:A. exchange

valueB. market valueC. use value to the ownerD. lender's value

• use value to the owner

All of the following are essential to the creation of an

agency relationship,EXCEPT:A. competent partiesB.

agreement to pay considerationC. agreement between principal and agentD. fiduciary relationship

• agreement to pay consideration

Which would be considered economic obsolescence?E.poor architectural designF. blighted neighborhoodG.termite damageH. deferred maintenance

• blighted neighborhood
• Which of the following comparables would be the most

helpful in appraising ahome?A. A similar home sold for nonpayment of taxes.B. A similar property sold under duress.C. A similar home sold by a motivated seller to a motivated buyer.D. A similar home sold by an unwilling seller to an unsure buyer.

• A similar home sold by a motivated seller to a motivated

buyer.Which of the following would NOT be a valid reason for the seller to terminate alisting?A. The broker's license was revokedB. The seller declared bankruptcyC. The broker was declared mentally incompetent prior to the listingD.The broker was declared mentally incompetent after the signing of the listing

• The seller declared bankruptcy

Four months ago, a seller entered into a legally binding written contract to sellhis property. Later, the seller refused to complete the transaction since he felt thevalue of the property would increase in the near future. Under these circumstances,the Statute of Limitations could affect the rights of the buyer to prevail in a civilaction due to a breach

of the written contract within:A. 90 daysB. one yearC. two

yearsD. four years

• four years

A broker secured a buyer for his principal and the seller accepted the offerpresented through the broker. Under which type of listing would the broker notreceive a commission from the principal?A. net listingB. open listingC. exclusive listingD. exclusive authorization and right to sell listing

• net listing