Chapter 10 Flashcards
A tangible or intangible benefit of real property that enhances its attractiveness or increases the satisfaction of the user.
Amenity
Amenities generally accrue to
home ownership
value is composed of two components
a return ON investment and a return OF investment.
To compensate for a higher risk
investors demand a higher return
Real estate offers potentially ____returns, with above average safety of investment, but only ______liquidity.
high, fair
a commodity that is bought and sold on the market, just as is lumber, shares of stock or real estate.
Money
The Federal Reserve’s efforts to influence the level of economic activity by regulating the availability of money and the rate of interest
Monetary Policy
The interaction of buyers and sellers who trade short-term money instruments.
Money Market
The interaction of buyers and sellers trading long- or intermediate-term money instruments. Longer than one year. Included mortgages, bonds and stocks
Capital Market
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
When was the Fed founded?
1913
The Federal Reserve consists of ____ regional banks
12
Who owns the Fed?
No one, it is independent
To whom is the Fed accountable?
Congress
Where are short-term money instruments bought and sold?
Money markt
As part of its monetary policy, the Fed can influence both the _______ of money and the _______ of money.
Supply, cost
The “price” of money is expressed as
interest rate
The interest rate that is charged by the Fed when lending money to banks is called the _______ rate.
discount
Which of the following typically incurs the highest burden of management?
savings account
money market
certificate of deposit
real estate
real estate
The return ON investment is usually accomplished through
interest payments
The Federal Reserve Board consists of ____ members.
7
The FDIC insures deposits up to $______________.
250,000
Money market is defined as the interaction of buyers and sellers who trade
short term instruments
Who appoints members to the Federal Reserve Board?
President of US
True or False? Stocks are considered a good investment because the return OF your investment is guaranteed.
False
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
both an owner-occupant and an investor would look at a property exactly the same
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
Liquidity
True or False? Money is a commodity that is bought and sold on the market.
True
The Fed consists of ______ regional banks.
12
To compensate for a higher risk, investors demand a
higher return
lower return
hedge
security deposit
higher return
The interest rate that is charged by the Fed when lending money to banks is called the _______ rate.
bank
discount
prime
bank-to-bank
discount
Which of the following typically incurs the highest burden of management?
savings account
money market
certificate of deposit
real estate
Real Estate
The Federal Reserve Board consists of ____ members.
7
The “price” of money is
its yield
an interest rate
change
its discount rate
An Interest rate
To whom is the Fed accountable?
Congress
No one
The President
The Treasury Department
Congress
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.
The president of the US`
The supply of money in the U.S. is regulated by
Congress
the Treasury Department
the Fed
the President
the Fed
