TEXAS Chapter 3 quiz 3 Flashcards

(TEXAS) Chapter 3 quiz 3 Flashcards The demand for real estate is affected by which of the following?populationThe answer is population. For example, the movement of people to the western and southern states creates a greater demand for housing in those areas. Other factors affecting demand are demographics and employment and wage levels. .Which is NOT insured by property insurance? Landhe answer is land. Land is not insured, because it cannot be destroyed. Similarly, because of its indestructibility, land cannot be depreciated. .Which of the following stages of the business cycle is characterized by a general economic decline?Recessionthe answer is recession. The normal business cycle has a period of growth or expansion, followed by a peak and a slow down or recession, followed by a depression and trough (or low point), followed by a period of renewed growth or revival. .When supply increases, real estate prices usually decrease..he answer is decrease. Supply and prices usually move in the opposite direction. When supply increases, prices drop. .Why are real estate prices slow to adjust? Nonmobile nature of real estate.Nonstandard characteristic of real estate.Length of time to complete construction.The answer is all of these. Real estate prices may be slow to adjust because real estate is nonmobile and nonstandard, and construction time may be lengthy. .In reference to real estate, which phrase means that investments are long term?Permanence of investment.The answer is permanence of investment. This characteristic is due to the immobility and indestructibility of real estate. Because land cannot be moved, investment in property cannot be moved if the market becomes more favorable elsewhere. Also, investments in real estate are complex and expensive, so they are not made as frequently as other transactions.Permanence of investment is an economic characteristic of real estate and is also known as fixity. .