CANVAS QUIZ: Chapter 12 Flashcards
The number one objective for investing in real estate is:
b. to make money.
Commercial banks make the majority of their funds available for what kind of loans?
- high-interest loans
- short-term loans
- credit cards, automobile, and construction loans
Income generated from an income property minus the expenses associated with it, is known as:
a. cash flow.
The total gross income a property is capable of producing at full occupancy, without any deductions for expenses is:
b. potential gross income.
For income tax purposes, which of the following are NOT considered operating expenses?
a. loan payments
b. depreciation allowances
c. income tax provisions
d. all of the above.
d. all of the above.
Which of the following is a category of operating expenses for appraisal purposes?
- fixed expenses
- variable expenses
- reserves for replacement
Which of the following are operating expenses that DO vary?
- utility costs
- property management fees
- cleaning and maintenance fees
Investors are looking for low (or reasonable) times gross of eight or less. The higher the gross multiplier:
a. the higher the price.
The net operating income is divided by the selling price to determine the appropriate:
b. capitalization rate (cap rate).
An association of two or more people combining their financial resources for the purposes of achieving one or more investment objectives is called:
a. a syndication.
A “business opportunity sale” can include:
- the sale of a business
- the lease of a business
- the goodwill of a business
In a probate sale, the initial offer must be for what percent of the inheritance tax appraisal value?
b. 90%
Under the Unified Commercial Code, a legal form that a creditor files to give notice that it has or may have an interest in the personal property of a debtor is called:
a. a financing statement.
Which of the following is true concerning the selling of manufactured homes? Real Estate licensees:
b. are not allowed to sell manufactured homes as long as they can be used as vehicles on the highway.
About three-fourths of the sales made by the typical realty office consist of:
a. residential property sales.