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chp 10 > chp 10 > Flashcards

chp 10 Flashcards

1
Q

The minimum interest rate set by the Federal Reserve for lending to other banks is known as the…?
ADiscount Rate
BFederal Funds Rate
CYield
DLIBOR

A

discount rate

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2
Q

The rate at which member banks charge each other for borrowing short-term money is known as the…?
AFederal Funds Rate
BDiscount Rate
CYield
DLIBOR

A

federal funds rate

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3
Q

An improvement which is not the highest and best use for the site on which it is placed by reason of excess size and cost is referred to as…?
AOver Improvement
BAbove Market Value
CUnder Improvement
DConformity

A

over improvement

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4
Q

In appraising, this is a valuation principle stating that market value is affected by the intersection of supply and demand forces in the market as of the appraisal date…?
APrinciple of Conformity
BPrinciple of Substitution
CPrinciple of Supply and Demand
DPrinciple of Highest and Best Use

A

Principle of Supply and Demand

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5
Q

This affirms that the maximum value of a property tends to be set by the cost of acquiring an equally desirable and valuable substitute property, assuming no costly delay is encountered in making the substitution….?
APrinciple of Conformity
BPrinciple of Substitution
CPrinciple of Supply and Demand
DPrinciple of Highest and Best Use

A

Principle of Substitution

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6
Q

This is an appraisal phrase meaning that use which, at the time of an appraisal, is most likely to produce the greatest net return to the land and/or buildings over a given period of time…?
AHighest and Best Use
BPrinciple of Conformity
CPrinciple of Contribution
DOver Improvement

A

Highest and Best Use

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7
Q

This refers to an improvement which, because of its deficiency in size or cost, is not the highest and best use of the site…?
AOver Improvement
BRegression
CConformity
DUnder Improvement

A

Under Improvement

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8
Q

When a property is “over improved” relative to other surrounding properties in the area that are of lesser value, it is referred as the…?
APrinciple of Highest and Best Use
BPrinciple of Supply and Demand
CLaw of Progression
DLaw of Regression

A

Law of Regression

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9
Q

Properties listed above market value typically take the longest to sell…?
AT (True)
BF (False)

A

true

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10
Q

This holds that it is the future, not the past, which is of prime importance in estimating value…?
APrinciple of Change
BPrinciple of Conformity
CPrinciple of Anticipation
DPrinciple of Substitution

A

Principle of Change

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11
Q

This affirms that value is created by anticipated benefits to be derived in the future…?
APrinciple of Change
BPrinciple of Conformity
CPrinciple of Anticipation
DPrinciple of Substitution

A

Principle of Anticipation

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12
Q

This is one of the three major valuation methods, which compares a subject property’s characteristics with those of comparable properties which have recently sold in similar transactions…?
ACost Approach
BSales Comparison Approach
CIncome Approach
DNet Present Value

A

Sales Comparison Approach

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13
Q

Which of the following is a means by which the Federal Reserve controls the money supply…?
AReserve requirement
BDiscount rate
CBond market
DAll of the above

A

all of the above

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14
Q

This is one of the three methods in the appraisal process in which a value estimate of a property is derived by estimating the replacement cost of the improvements, deducting therefrom the estimated accrued depreciation, then adding the market value of the land…?
ACost Approach
BSales Comparison Approach
CIncome Approach
DNet Present Value

A

Cost Approach

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15
Q

The ability to deduct expenses on improvements made to income producing property is referred to as…?
ADepreciation
BDeduction
CAppreciation
DDeflation

A

Depreciation

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16
Q

The economic life of a building minus its effective age is known as…?
AInvestment Life
BChronological Age
CRemaining Economic Life
DOccupancy Age

A

Remaining Economic Life

17
Q

he depreciation for a residential property is how many years…?
A27.5
B30
C39
D40

A

27.5

18
Q

A loss of value due to adverse factors from within the structure which affect the utility of the structure, value and marketability is known as…?
AEconomic Obsolescence
BFunctional Obsolescence
CPhysical Obsolescence
DNone of the above

A

Functional Obsolescence

19
Q

A loss in value due to factors away from the subject property but adversely affecting the value of the subject property is known as…?
APhysical Obsolescence
BFunctional Obsolescence
CEconomic Obsolescence
DNone of the above

A

Economic Obsolescence

20
Q

The loss in value due to the actual wearing out of the improvements is known as…?
APhysical Obsolescence
BFunctional Obsolescence
CEconomic Obsolescence
DNone of the above

A

Physical Obsolescence

21
Q

This is one of the three methods of the appraisal process generally applied to income producing property, and involves a three-step process – (1) find net annual income, (2) set an appropriate capitalization rate or “present worth” factor, and (3) capitalize the income dividing the net income by the capitalization rate…?
ASales Comparison Approach
BIncome Approach
CCost Approach
DNone of the above

A

Income Approach

22
Q

The rate of interest which is considered a reasonable return on the investment, and used in the process of determining value based upon net income is known as…?
AInterest Rate
BCapitalization Rate
CEffective Yield
DNet Present Value

A

Capitalization Rate

23
Q

Capitalization Rate is equal to…?
A NOI / Purchase Price
B Purchase Price / Gross Income
C Gross Income / Purchase Price
D Purchase Price / NOI

A

NOI / Purchase Price

24
Q

A written statement, independently and impartially prepared by a qualified appraiser setting forth an opinion in a federally related transaction as to the market value of an adequately described property as of a specific date is known as a/an…?
A Good Faith Estimate
B Pro Forma
C Appraisal
D Valuation Statement

A

Appraisal

25
Q

One qualified by education, training and experience who is hired to estimate the value of real and personal property based on experience, judgment, facts, and use of formal appraisal processes is known as a/an…?
A Real Estate Broker
B Appraiser
C Underwriter
D Mortgage Broker

A

Appraiser

26
Q

the present worth of future benefits arising out of ownership to typical users/investors is referred to as…?
A Yield
B Value
C Return
D Cost

A

Value

27
Q

The supply of willing and able buyers in the marketplace or lack thereof is referred to as…?
A Demand
B Scarcity
C Utility
D Inventory

A

Demand

28
Q

The ability to give satisfaction and/or excite desire for possession is known as…?
A Demand
B Scarcity
C Utility
D Yield

A

utility

29
Q

This holds that the maximum of value is realized when a reasonable degree of homogeneity of improvements is present…?
A Principle of Conformity
B Principle of Contribution
C Principle of Supply and Demand
D Principle of Substitution

A

Principle of Conformity

30
Q

When a component part of a property is valued in proportion to its contribution to the value of the whole, it is referred to as this principle…?
A Principle of Conformity
B Principle of Contribution
C Principle of Supply and Demand
D Principle of Substitution

A

Principle of Contribution

chp 10 (1 decks)

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