Chp. 28 Quiz - Types of Investment Properties Flashcards
Which occurrence is advantageous to investing in undeveloped land?
Appreciation potential
What type of office buildings are usually one or two stories that can accommodate warehouse and light industrial activities in addition to offices?
Flex space office buildings
With a two-to-four family dwelling as an investment, which of the following expenses would the owner probably not pay for?
Gas
Because money has potential earning capacity, it is said that money available at the present time is worth more than the same amount available in the future. This concept is known as
Time value of money.
Mega malls contain
Three or more full-line department stores.
What is the concept of using other people’s money for investing?
Leverage
Financial leverage can be measured as
A debt to equity ratio.
Which of the following is NOT a disadvantage of investing in a single-family home?
Scarcity
Financial leverage is created by
Mixing borrowed funds with the investor’s equity.
Which office building would have one to five stories with landscaping?
Garden
Property is considered a/n _________ asset if it cannot be transferred as easily as other assets, such as stocks or bonds.
illiquid
Inflation risk is
The risk that income from the investment may not increase as fast as inflation.
Which of the following is not a type of industrial property?
Corporate headquarters
The government is most likely to pass rent control laws on which kind of property?
Apartment building
Why are condominiums good investment properties?
They are easy to rent and the investor is not responsible for exterior maintenance.
