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Basic Appraisal Principles > Chapter 10 > Flashcards

Chapter 10 Flashcards

1
Q

A tangible or intangible benefit of real property that enhances its attractiveness or increases the satisfaction of the user.

A

Amenity

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2
Q

Amenities generally accrue to

A

home ownership

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3
Q

value is composed of two components

A

a return ON investment and a return OF investment.

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4
Q

To compensate for a higher risk

A

investors demand a higher return

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5
Q

Real estate offers potentially ____returns, with above average safety of investment, but only ______liquidity.

A

high, fair

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6
Q

a commodity that is bought and sold on the market, just as is lumber, shares of stock or real estate.

A

Money

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7
Q

The Federal Reserve’s efforts to influence the level of economic activity by regulating the availability of money and the rate of interest

A

Monetary Policy

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8
Q

The interaction of buyers and sellers who trade short-term money instruments.

A

Money Market

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9
Q

The interaction of buyers and sellers trading long- or intermediate-term money instruments. Longer than one year. Included mortgages, bonds and stocks

A

Capital Market

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10
Q

Which type of purchaser is more likely to pay more attention to the amenities of a property, such as a pool, a horse stable, or a nice view?

A

Owner occupant buyer

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11
Q

When was the Fed founded?

A

1913

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12
Q

The Federal Reserve consists of ____ regional banks

A

12

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13
Q

Who owns the Fed?

A

No one, it is independent

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14
Q

To whom is the Fed accountable?

A

Congress

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15
Q

Where are short-term money instruments bought and sold?

A

Money markt

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16
Q

As part of its monetary policy, the Fed can influence both the _______ of money and the _______ of money.

A

Supply, cost

17
Q

The “price” of money is expressed as

A

interest rate

18
Q

The interest rate that is charged by the Fed when lending money to banks is called the _______ rate.

A

discount

19
Q

Which of the following typically incurs the highest burden of management?

savings account
money market
certificate of deposit
real estate

A

real estate

20
Q

The return ON investment is usually accomplished through

A

interest payments

21
Q

The Federal Reserve Board consists of ____ members.

A

7

22
Q

The FDIC insures deposits up to $______________.

A

250,000

23
Q

Money market is defined as the interaction of buyers and sellers who trade

A

short term instruments

24
Q

Who appoints members to the Federal Reserve Board?

A

President of US

25
Q

True or False? Stocks are considered a good investment because the return OF your investment is guaranteed.

A

False

26
Q

Which type of purchaser is more likely to pay more attention to the amenities of a property, such as a pool, a horse stable, or a nice view?

  • owner-occupant buyer
  • investor
  • both an owner-occupant and an investor would look at a property exactly the same
A

both an owner-occupant and an investor would look at a property exactly the same

27
Q

You are an investor who owns a parcel of real property. You want to cash out your investment, and it takes you a year to market your property and close the sale. What investment factor does this demonstrate?

  • favorable tax treatment
  • safety
  • liquidity
  • easement
A

Liquidity

28
Q

True or False? Money is a commodity that is bought and sold on the market.

A

True

29
Q

The Fed consists of ______ regional banks.

A

12

30
Q

To compensate for a higher risk, investors demand a

higher return
lower return
hedge
security deposit

A

higher return

31
Q

The interest rate that is charged by the Fed when lending money to banks is called the _______ rate.

bank
discount
prime
bank-to-bank

A

discount

32
Q

Which of the following typically incurs the highest burden of management?

savings account
money market
certificate of deposit
real estate

A

Real Estate

33
Q

The Federal Reserve Board consists of ____ members.

A

7

34
Q

The “price” of money is

its yield
an interest rate
change
its discount rate

A

An Interest rate

35
Q

To whom is the Fed accountable?

Congress
No one
The President
The Treasury Department

A

Congress

36
Q

Who appoints members to the Federal Reserve Board?

they are elected by public vote
the Secretary of the Treasury
the FRB chairperson
the President of the U.S.

A

The president of the US`

37
Q

The supply of money in the U.S. is regulated by

Congress
the Treasury Department
the Fed
the President

A

the Fed

Basic Appraisal Principles (19 decks)

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