CANVAS QUIZ: Chapter 12 Flashcards

1
Q

The number one objective for investing in real estate is:

A

b. to make money.

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2
Q

Commercial banks make the majority of their funds available for what kind of loans?

A
  • high-interest loans
  • short-term loans
  • credit cards, automobile, and construction loans
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3
Q

Income generated from an income property minus the expenses associated with it, is known as:

A

a. cash flow.

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4
Q

The total gross income a property is capable of producing at full occupancy, without any deductions for expenses is:

A

b. potential gross income.

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5
Q

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.

A

d. all of the above.

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6
Q

Which of the following is a category of operating expenses for appraisal purposes?

A
  • fixed expenses
  • variable expenses
  • reserves for replacement
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7
Q

Which of the following are operating expenses that DO vary?

A
  • utility costs
  • property management fees
  • cleaning and maintenance fees
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8
Q

Investors are looking for low (or reasonable) times gross of eight or less. The higher the gross multiplier:

A

a. the higher the price.

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9
Q

The net operating income is divided by the selling price to determine the appropriate:

A

b. capitalization rate (cap rate).

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10
Q

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. a syndication.

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11
Q

A “business opportunity sale” can include:

A
  • the sale of a business
  • the lease of a business
  • the goodwill of a business
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12
Q

In a probate sale, the initial offer must be for what percent of the inheritance tax appraisal value?

A

b. 90%

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13
Q

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. a financing statement.

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14
Q

Which of the following is true concerning the selling of manufactured homes? Real Estate licensees:

A

b. are not allowed to sell manufactured homes as long as they can be used as vehicles on the highway.

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15
Q

About three-fourths of the sales made by the typical realty office consist of:

A

a. residential property sales.

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16
Q

An agreement where the seller of a business agrees to not open a competing business for a period of time within a specific geographical area is referred to as:

A

c. a covenant not to compete.

17
Q

The term RPSD stands for:

A

a. real property securities dealer.

18
Q

In California, before selling real property securities to the public, the broker must obtain an endorsement from the:

A

b. california department of real estate.

19
Q

A syndication can be a:

A
  • corporation
  • partnership
  • trust
20
Q

The broker’s broker or consultant is one way to describe the:

A

a. real estate investment counselor.