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When demand for a commodity decreases and supply remains the same:
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A licensed real estate professional acting as a point of contact between two or more people in negotiating the sale, rental, or purchase of a property is known as a(n):
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Legal 3130
Real Estate Principles
| Question | Answer |
|---|---|
| When demand for a commodity decreases and supply remains the same: | price tends to fall. |
| A licensed real estate professional acting as a point of contact between two or more people in negotiating the sale, rental, or purchase of a property is known as a(n): | broker. |
| All of the following would affect supply EXCEPT: | Population |
| All of the following are categories of the uses of real property EXCEPT | Developmental |
| All of the following would affect demand EXCEPT | Fiscal policy |
| All of the following affect how quickly the forces of supply and demand work EXCEPT | Degree of standardization of the product's price |
| A real estate professional who performs a visual survey of a property's structure and systems and prepares an analytical report for a purchaser or an owner is acting as a(an): | home inspector |
| When supply of a commodity decreases while demand remains the same, | price tends to rise |
| When responsible for maintaining a client's property and maximizing return on the client's investment, a broker is serving as a(n) | property manager |
| Detailed information about the age, education, behavior, and other characteristics of members of a population group is called | demographics |
| The phrase "bundle of legal rights" is properly included in | the definition of real property |
| All of the following are included in the right to control one's property EXCEPT | the right to exclude the utilities' meter reader |
| According to law, a trade fixture is usually treated as | personalty |
| Kandace is interested in a house that fits most of her needs, but it is located in a busy area where she is not sure she wants to live. Her concern about the property's location is called | area preference |
| Which of the following is considered personal property? | Patio furniture |
| All of the following are properly described by the word "improvement" EXCEPT | trade fixtures |
| Real property can become personal property by | severance |
| All of the following are physical characteristics of land EXCEPT | scarcity |
| A broker showed an owner-occupied property that had window screens, custom venetian blinds,and a wall bed to a buyer whose offer was then accepted by the owner. Before the close of escrow, the seller may remove | none of the identified items |
| Land is considered to be | indestructible |
| A rancher owns a parcel of land on which oil is discovered. If the rancher has not previously conveyed the oil rights, who owns the oil? | The rancher |
| The type of housing which can become permanent if affixed to the land is called | manufactured |
| All of the following are treated as personal property EXCEPT | Fructus naturales |
| Fixtures are | treated as real property |
| After the construction of a building in the air rights above a railroad right-of-way, the trains can | operate as usual |
| All of the following are economic characteristics of land EXCEPT | uniqueness |
| Generally, personal property can be distinguished from real property by its | mobility. |
| An important characteristic of land is that it may be modified or improved at some point in time. Depending on its type, an improvement may increase the value of real estate greatly. all of the following are considered to be improvements EXCEPT | Crops |
| Tonya leases store space to Klem for a restaurant, and Klem installs his ovens, booths, counters, and other equipment. When would these items become real property? | If Klem does not remove them at lease expiration. |
| Rights or privileges which are connected with real property, are | appurtenances |
| The term improvements, when referring to real estate, would include | sidewalks. |
| Which of the following is NOT a test to identify a fixture? | Size of the item |
| The owner of a house wants to fence the yard for her dog. When the fence is erected, the fencing materials are converted to real estate by | annexation. |
| The uniqueness of land and its inability to be substituted is known as | Nonhomogenity |
| The rights of ownership of real property include all of the following EXCEPT the right of | compatibility |
| A bill of sale is used to transfer the ownership of | personal property |
| Efforts to increase home ownership include all of the following EXCEPT | penalizing first-time homebuyers for using funds from IRA's |
| The real cost of owning a home includes certain costs/expenses that many people overlook. Which of the following is NOT such a cost/expense of home ownership? | Personal property taxes |
| Margie listed her real estate for sale at $100,000. If her cost was 80 percent of the listing price, what will her percentage of profit be when her real estate is sold for the listing price? | 25 percent |
| Most homeowner's insurance policies contain which of the following clauses? | A coinsurance clause |
| The portion of the value of owners' property that exceeds the amount of their mortgage debt is called | equity. |
| Homeowners may deduct all of the following expenses when preparing their income tax return EXCEPT | mortgage interest on a third home. |
| If a homeowner's insurance policy provides coverage for less than 80 percent of the full replacement cost of the dwelling, then the loss of the residence will be settled for | either the actual cash value or the prorated repair cost. |
| The Levines sold their vacation home for $188,000. If they made a profit of 10 percent, what was the original cost of their property? | $170,900 |
| The selling price of a property is $96,000. This can be financed if the buyer can put 10 percet down and pay a loan origination fee of 1.5 percent. How much cash must the buyer produce to complete this transaction? | $10,896 |
| Federal income tax law excludes gain realized on the sale of a primary residence for individuals filing separately and for couples filing jointly. The amount of this exclusion is (separately/jointly): | $250,000/$500,000 |
| Damage from which of the following is NOT covered in a basic homeowner's policy? | Flood |
| Federal income tax regulations allow homeowners to reduce their taxable income by amounts paid for | real estate taxes |
| When Homeowner Harry's sold his residence recently, he found that he had more than $20,000 in equity. This equity did NOT come from | the use of an interest-only mortgage payment plan. |
| The buyer of a $125,000 home was paid $2,000 as earnest money and has a loan commitment for 70 percent of the purchase price. The balance of the cash the buyer needs to complete the transaction is | $35,500 |
| Which of the following type of development combines office space, stores, and residential units in a single, vertical community known as a | mixed-use development |
| Three years ago Dr. and Mrs. Henderson moved from the house they had owned for 20 years, but did not sell it. They decided to travel and brought a mobile home to live in. They now sell the house. How much of their capital gain on the house will be taxabl | None of it, if it is less than $500,000 |
| The purchaser of a property in a planned unit development will usually NOT receive | a direct ownership interest in the common areas |
| A real estate broker's responsibility to keep the principal informed of all of the facts that could affect a transaction is the duty of | disclosure |
| Which of the following would be considered dual agency? | A broker's acting for both the buyer and the seller in the same transaction |
| The relationship of a broker to his or her client is that of a(n) | fiduciary |
| A real estate broker acting as the agent of the seller | must promote and safeguard the seller's best interest |
| In designated agency all of the following apply EXCEPT | the same agent may represent both the buyer and the seller at the same time |
| A broker is permitted to represent both the seller and the buyer in the same transaction when | both parties have been informed and agree to teh dual representation |
| Which of the following would be considered lawful practice in real estate brokerage? | Exaggerated statements about the property |
| As an agent for the seller, a real estate broker can | solicit an offer to purchase the property from a prospective buyer. |
| A seller has listed her home with the broker for $190,000. The listing broker tells a prospective buyer to submit a low offer because the seller is desperate to sell. They buyer offers $185,000 and the seller accepts it. In this situation, | the broker has violated his agency relationship with the seller |
| When Broker Hearn was told by his principal not to advertise her property in a certain newspaper, which was out of the area, Hearn complied because he | must obey the lawful instructions of his principal. |
| It is the duty of an agent to disclose to the principal every material step taken in the transaction of the principal's business. This is because the | agent has fiduciary obligations to the principal. |
| Upon discovering a latent defect in a property, the Broker Alice should discuss the problem with seller Juan and then | inform any prospective buyers of the defect |
| The type of agency practiced in which there is only ever one client is | single agency |
| A salesperson who is employed by a broker told a prospective buyer that the house she was looking at is "the best house in the area." Because of this statement, | the salesperson was practicing puffing. |
| Which of the following best defines the law of agency? | The rules of law that apply to the responsibilities of a person who acts as agent for another. |
| A broker who is the agent of the buyer should do which of the following? | Advise the buyer if the listing price of the seller's house is unrealistic |
| A salesperson sells buyer Fred property listed by another brokerage firm in the Multiple Listing System. The salesperson has been working with Fred for many months but does not have an agency contract with him. Fiduciary obligations to | the seller |
| Broker Joan shows properties listed for sale with her company to prospect Karl. Karl has refused buyer representation. Karl is Joan's | customer |
| Mr. Moe's house has been listed for sale for more than one year and he is very anxious to move into a retirement community. Salesperson Rachel, who is a subagent of the seller, tells a prospective buyer to make a low offer. All are true EXCEPT: | She acted appropriately to get the seller's property sold. |
| A salesperson who represents the seller is showing a house to a prospective buyer-customer. The salesperson knows that the house has water problems in its basement. Which of the following is true? | Withholding the information prevents the buyer from making an informed decision. |
| Broker Sven, in the course of selling a home to Nancy, told her that the foundation was "solid as a rock", but in fact slowly sinking. Now that the sale is settled, which of the following is LEAST LIKELY to happen to Sven? | Successful defense against all charges based on loyalty to his client-seller |
| Broker LaRue's newest salesperson, Shandra, lists a unit in a condominium building for sale. In this transaction Shandra | acts on behalf of LaRue, her broker |
| A broker who represents a seller under an exclusive-agency listing receives two offers for the property at the same time, one from one of his salespeople and one from the salesperson of a cooperating broker. What should the broker do? | Submit both offers at the same time |
| Two salespeople working for the same broker obtained offers on a property listed. The first offer was obtained early, the second later in the afternoon. The broker presented the first offer to the seller, and did not inform of the second. Which is true? | The broker has no authority to withhold any offers from the seller. |
| A broker has an exclusive-right-to-sell listing on a building. Owner is out of town, offer from buyer to purchase providing seller agrees to take a purchase money mortgage. the buyer must have a commitment from seller. Under these circumstances the | the broker must obtain the signature of the seller to effect a contract. |
| A property manager is hired to manage a property while the owner is overseas for two years. The property manage is a(n) | general agent |
| Broker Smith is helping a buyer and seller fill out a sales contract, but is not representing either party. Broker Smith is a(n) | transactional broker |
| The amount of commission that is paid to salesperson Sharise is determined by | the mutual agreement with her broker. |
| Broker Janna was accused of violating antitrust laws. Of the following, she was most likely accused of | price fixing |
| Real estate broker Todd was responsible for a chain of events that resulted in the sale of one of his client's properties. This is referred to as | procuring cause |
| Salesperson Norman wants to be classified as a qualified real estate agent-the equivalent of holding independent contractor status. All of the following are requirements for him to meet EXCEPT | Be free from supervision by his broker and office manager. |
| A parcel of vacant land 80 feet wide and 200 feed deep was sold for $200 per front foot. How much money would salesperson receive for her 60 percent share in the 10 percent commission? | $960 |
| A real estate salesperson, classified by the IRS as an independent contractor, receives | negotiated commissions on transactions. |
| In a typical agency relationship between broker and client, the broker's commission is determined by | mutual agreement |
| Salesperson Nellie finally concluded some extremely difficult negotiations that resulted in the sale of a listed parcel of land. For all of her extra efforts, she can legally receive a performance bonus from | her broker |
| Wella works for Broker Vincent. Well sells a $150,000 home with another brokerage. Listing commission is 6.5 percent. Well is entitled to receive | $3,217.50 |
| All of the following are required of a broker when seeking to collect a commission for brokering the sale of a property EXCEPT | Complying with a set commission rate set by a trade organization |
| A broker lists property for $100,000 with 5 percent commission, and later obtains an oral offer. The seller indicates the offer would be acceptable if submitted in writing. Before its put in writing, the buyer backs out. In this situation, broker entitled | no commission |
| all of the following are prohibited under the antitrust laws EXCEPT | A broker's setting a company commission schedule |
| Landowner Shelley subdivides her acreage and offers the lots for sale. Broker Ernie tells her that he can sell the lots. After Ernie sells some of the lots, the landowner refuses to pay him a commission. The broker can | do nothing |
| Owners have been interviewing salespersons from different firms. They tell Aida's Ramses that Botchko Properties will charge 2 percent lower commission for selling home. What should Aida's salesperson say to the owner in order to get the listing? | Aida Realty provides excellent services to market their seller's properties |
| The listing and the selling broker agree to split a 7 percent commission 50/50 on $196,900. the listing broker gives the salesperson 30 percent of commission, and selling broker gives salesperson 35 percent commission. How much selling salesperson earn? | $2,412.03 |
| Unless some other written agreement has been made, broker Hugo will usually receive his brokerage commission when | the transaction is closed |
| "Fee-for-services" means | offering real estate services in a piecemeal fashion |
| Each of two brokerage companies claimed full commission for the sale of a property that was listed by both the firms under open listing agreements. The broker who is entitled to the commission is the one who | was the procuring cause of the sale |
| The National Do-Not-Call Registry provides that | consumers who have made an inquiry to a licensee may be contacted up to 3 months later |
| All of the following reasons are valid bases for terminating a listing agreement EXCEPT | Death of the salesperson |
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