mock 6

Question 1

On December 21, Kate received an offer from Justin to buy Kate’s house for $249,000. The offer also stated that it would be open for acceptance until 11 am, December 31. Which of the following statements is TRUE?

1. Justin cannot revoke his offer because he has promised that he will buy it by
   certain time.
2. Justin offer represents an option agreement.
3. If Kate makes a counter-offer for $250,000 and Justin rejects it, Kate may sue
   him for damages.
4. If Kate makes a counter-offer, Justin’s offer is terminated.

Answer 1

4. If Kate makes a counter-offer, Justin’s offer is terminated.

Question 2

One of more of the following statements describing the BC land registration system is
TRUE
A. Documents transferring a fee simple title must be registered to be effect and
enforceable against subsequent bona fide purchasers of the same fee simple.
B. A charge registered against a fee simple title may be removed from title if it is a forged
document.
C. The Assurance Fund will compensate every financial loss incurred as a result of BC’s
land registration system regardless of the cause of the loss.
D. Unless the Land Title Act specifies the use of a particular form, any instrument sufficient
to pass or create an estate or interest in land is registrable.

1. Only A is true
2. Only C and D are true
3. Only A, C and D are true
4. Only A, B and D are true

Answer 2

4. Only A, B and D are true

Question 3

Which of the following statements concerning the tort of negligence is TRUE?

1. A duty of care owed by the defendant to the plaintiff exists when the plaintiff proves that negligence action is found to have been made by a person whom the defendant ought to have known as someone likely to be injured by the defendant’s conduct.
2. Where a duty of care exists, the relevant standard of care will be that which a reasonable person would take, in all the circumstances of the case.
3. Where an employee is negligent in the performance of his or her duties of employment, the employer may be liable for any foreseeable damages under the principle of vicarious liability.
4. All of the above statements.

Answer 3

4. All of the above statements.

Question 4

Real Estate values are influenced by externalities. Which of the following below could be used to determine this principle?

1. The market suffers a significant drop in world oil prices and because of this, the supply of vacant office space increases in the city
2. It is being announced that a small residential area has been rezoned for a shopping center.
   3.The value of the houses in the residential will increase
   Because of unemployment, real estate prices decline
3. All of the above

Answer 4

2. It is being announced that a small residential area has been rezoned for a shopping center.

Question 5

Which of the following statements regarding property appraisal is FALSE

1. the courts have recognized that a reasonable margin of error exists when
   calculating damages resulting from a negligent appraisal
2. The value of real property can always be established with certainty
3. A large over-valuation of property by an appraiser does not, by itself, establish
   liability on the part of the appraiser
4. The courts provide some guidelines as to an appraiser’s legal responsibilities that
   are outlined in the law of contract and the law of tort.

Answer 5

2. The value of real property can always be established with certainty

Question 6

Which of the following is NOT a consideration of planners based on local government’s planning process?

1. The testing of alternate courses of action.
2. The forecasting of future requirements or trends.
3. The establishing of long and short-term goals,
4. The enforcement of the bylaws of a given local government.

Answer 6

4. The enforcement of the bylaws of a given local government.

Question 7

Buyer and Seller entered into a building contract of purchase and sale of the
seller’s townhouse. Shortly before the completion date, the buyer, regretting her
decision to purchase the townhouse, and informs the seller than she will not
complete the sale. The Seller decides to initiate a court proceeding against the
buyer, what damages would court likely receive?

1. out –of-pocket expenses incurred in reselling the house.
2. Provided that the seller can demonstrate that he exercised reasonable
   efforts to sell the townhouse, and can ask for the difference in contract
   prices, if the second sale was for a lower price.
3. Quantum meruit
4. Both (1) and (2)

Answer 7

4. Both (1) and (2)

Question 8

Which of the following statements regarding the comparative method of appraisal is TRUE?

1. The comparative method of appraisal should be used in the property possesses latent value
2. To apply the comparative method of appraisal, the appraiser estimates the market value of
   the subject property using as evidence the sale prices of similar properties which would sold
   at any time prior to the appraisal
3. The comparative method of appraisal is the most inexact approach for finding market value
   since cost and market value are not necessary equal at any particular time
4. The comparative method reflects market behavior and requires a minimum of subjective
   opinion from the appraiser

Answer 8

4. The comparative method reflects market behavior and requires a minimum of subjective
   opinion from the appraiser

Question 9

Your friend mentioned to you that the value of his house was $500,000

Understanding what he means, you know that the true value of an appraisal is:

1. Known as the value to the owner because it is subjective in nature.
2. The market value of the physical property.
3. A combined value that considers personal property, public property and government limitations.
4. The value of the legal rights of ownership vested in a particular piece of property

Answer 9

4. The value of the legal rights of ownership vested in a particular piece of property

Question 10

Which of the following statements is TRUE with respect to common law duress?

1. To successfully claim law duress, the innocent party has to prove that she
   was physically harmed by the other party.
2. A finding of common law duress will automatically void the contract
   3.. To successfully claim common law duress, the innocent party that the
   contract is substantially unfair.
3. A finding of common law duress will result in the contract being voidable by
   the party that was robbed of the free will to contract.

Answer 10

4. A finding of common law duress will result in the contract being voidable by
   the party that was robbed of the free will to contract

Question 11

The decisions of a disciplinary committee:

1. Must be issued orally, and specify ant discipline imposed.
2. Must be issued both orally and in writing, and specify any discipline imposed.
3. Must be in writing, and specify any discipline imposed.
4. Must be in writing, but need not specify any discipline imposed.

Answer 11

3. Must be in writing, and specify any discipline imposed.

Question 12

Which of the following statements are TRUE?
A. Licensees must to ensure that when the listing get expired to remove It
immediately from the website (s)
B. The name of the brokerage does not need to be included on your website.
C. Listing information should be kept current and accurate.
D. Websites must be reviewed for currency at least once per week.

1. Only A and B
2. Only B and D
3. Only A and C
4. Only B and C

Answer 12

3. Only A and C

Question 13

What is the primary difference between an Assessment Appraisal and Private Fee Appraisal?

1. a private fee appraiser has access to all have a data for all real property transactions as
   reported by land title office.
2. An assessor would normally adjust his or her estimate of value to reflect the tenants interest,
   whereas the private fee appraiser does not.
3. The private fee appraiser looks at the market for the various indicators of values and then
   proceeds toward the assessment of each property, whereas the assessor does not.
4. the assessor is constrained to certain dates and must value all interest in land.

Answer 13

4. the assessor is constrained to certain dates and must value all interest in land.

Question 14

In Negotiation we should be focusing on:

A. Setting a resistance point

B. Establishing an aspiration target

C. Focusing on what each party wants

1. All of the above
2. A and B
3. B only
4. B and C

Answer 14

3. B only

Question 15

Which of the following is an accurate statement about principle of indefeasibility?

1. The principle of indefeasibility operates on the basis that registered owner on title provides conclusive evidence of that person’s entitlement to the fee
   simple estate.
2. The principle of indefeasibility means that in no circumstances may the purchaser be set aside, even by the claims of a previous rightful owner
3. If a registered owner loses an interest in land due to the principle of indefeasibility he or she will automatically qualify for compensation from the assurance fund
4. The principle of indefeasibility extends to all validly registered charges on title

Answer 15

1. The principle of indefeasibility operates on the basis that registered owner on title provides conclusive evidence of that person’s entitlement to the fee
   simple estate.

Question 16

A mortgage loan has a face value of $250,000, an interest rate of 3.5 per annum, compounded semi-annually. Amortization period of 20 years, a term of 3 years and accelerated biweekly payments, rounder up to the next higher dollar. The amount of the accelerated biweekly payments will be?

1. $668.00
2. $1,447.00
3. $724.00
4. $1,336.00

Answer 16

3. $724.00

Question 17

A periodic tenancy is:

1. Automatically renews itself on the last day of the term for a further term of the same
   length.
2. A lease with no predetermined expiry date
3. A type of fixed term lease
4. A lease that has a predetermined expiry date.

Answer 17

1. Automatically renews itself on the last day of the term for a further term of the same
   length.

Question 18

You have promised to pay your friend $15,000 four years from today. What is
the value of $15,000 today if the effective annual interest rate is 7%.

1. $11,443.43
2. $19,661.94
3. $14,655.05
4. $10,995.68

Answer 18

1. $11,443.43

Question 19

You have a partially completed appraisal report that you need to fill in. The house next door to the subject property is similar in all respects except for the number of bedrooms and square footage. This 2,300 square foot comparable sold for $250,000, has 4 bedrooms, and was adjusted +$4,200 for bedrooms and +$15,000 for square footage. If the market value of a bedroom is $4,200 and above a 1,900 sq. ft. benchmark, each 100 sq. ft. is worth $5,000, it can be concluded that the subject property has:

1. 5 bedrooms and 2,300 square feet.
2. 4 bedrooms and 2,000 square feet.
3. 3 bedrooms and 2,200 square feet.
4. 5 bedrooms and 2,600 square feet.

Answer 19

4. 5 bedrooms and 2,600 square feet.

Question 20

Which of the following statements regarding loan to value ratio and lending
value are TRUE?
A. Lending value is a long term conservative estimate of the value pledged as
security.
B. Lending value is an estimate of the mortgage loan a purchaser will be able
obtain.

C. The maximum loan-to- value ratio is set by statue as 80% for federally
chartered financial institutions unless the mortgage is insured.
D. A loan-to- value ratio that is higher than the competitor’s will drive the
lending activity to other lenders.

1. Only statements B and D are true
2. Only statements A and C are true
3. Only statements A,C and D are true
4. Only statements A, B, and D are true

Answer 20

2. Only statements A and C are true

Question 21

Michelle, on her way home from work, noticed that the neigbours house is for
sale. Michelle has always liked this property which was located on the quiet street
and backs onto a wooden area. Michelle decided to go ask the owners for the price.
As she walked across the lawn, a tree branch fell down and hit her. As a result, she
broke her arm and couldn’t go back to work for two months. Which one of the
following statements is FALSE?

1. Michelle can sue the owners of the property for her lost wages only if she can
   prove that they were previously aware of the hazard presented by the old
   tree.
2. Even though Michelle was not invited onto the property by the owners, the
   owners owe a duty of care to her.
3. The BC Occupiers Liability Act governs in this case and sets out the duty of
   care owed by an occupier.
4. The BC Occupiers Liability Act has replaced the common law rules governing
   Occupier’s liability in BC.

Answer 21

1. Michelle can sue the owners of the property for her lost wages only if she can
   prove that they were previously aware of the hazard presented by the old
   tree.

Question 22

While the provincial government has delegated most of the duties to the local governments, there are certain controls imposed directly by the provincial governments. Which of the following statues is an exercise of the provincial governments?

The Heritage Conservation Act
The Environmental Management Act
The Health Act
All of the above

Answer 22

4. All of the above

Question 23

The British Columbia Supreme court takes hearings after:

1. The British Columbia Court of Appeal
2. The Small Claims Court
3. The Small Claims Tribunal
4. The Court of Queen’s Bench.

Answer 23

2. The Small Claims Court

Question 24

You have a partially completed appraisal report that you need to fill in. The subject property has 4 bedrooms and 4 bathrooms. The house next door is similar in all respects except for the number of bedrooms and bathrooms. The comparable has a sale price of $281,000, a -$3,200 adjustment for bedrooms, and a +$2,700 adjustment for bathrooms. If the market value of a bedroom is $3,200 and the market value of a bathroom is $2,700, it can be concluded that this comparable has:

1. 5 bedrooms and 2 bathrooms.
2. 3 bedrooms and 3 bathrooms.
3. 4 bedrooms and 3 bathrooms.
4. 5 bedrooms and 3 bathrooms.

Answer 24

4. 5 bedrooms and 3 bathrooms.

Question 25

When a licensee searches for the title of a property, which of the following will show be noted on the title?
A. Join tenancy
B. An easement
C. Restrictive covenant
D. A building Scheme

1. B only
2. B and C only
3. A Only
4. All of the above

Answer 25

4. All of the above

Question 26

Which of the following is NOT an example of a residential agreements that Tenancy Act would apply?

1. Carla is a school teacher in northern British Columbia . She lives in a small
   house owned and rented to teachers by the Church organization which
   operates the program which she teaches.
2. Jim and his wife Helen are caretakers on a large estate on Vancouver Island.
   They live in double wide manufactured home owned by their employer and
   located on a the hill on the private road that runs through the estate.
   3.. Mandy is an art student who rents a bedroom in a Victorian style house for
   $200 a month. Victor, the owner, rents out the 7 bedroom to students and
   lives in the basement himself.
3. Bob leases a small warehouse in which he operates his computer business.
   The top floor of the warehouse contains a 3 room apartments that Bob lives.

Answer 26

4. Bob leases a small warehouse in which he operates his computer business.
   The top floor of the warehouse contains a 3 room apartments that Bob lives.

Question 27

Which one of the most important features of an energy efficient house?

1. Only uses wood burning fireplaces and stoves.
2. Only faces north in order to take advantage of solar heating
3. Has a draft free building envelope.
4. Has a single glazed thermal windows.

Answer 27

3. Has a draft free building envelope.

Question 28

A key principle of nuisance is that

1. A person owes a duty of care to ensure that those who enters onto their property will be reasonable safe in using the premises.
2. A person may not use his or her own property in such a way that causes injury or harm to another.
3. A person who employs another will be responsible for the employed person’s conduct performed in he ordinary course of business.
4. Tenants must respect a landlord’s common law right of quiet enjoyment.

Answer 28

2. A person may not use his or her own property in such a way that causes injury or harm to another.

Question 29

The Errors and omission Indemnity Plan cover which of the following:

1. Acts performed by a licensee that causes bodily injury to a person
2. Fraudulent acts committed by the licensee on the course of business practice
3. Negligent acts committed by the licensee in he course of his or her real estate
   practice.
4. All of the above

Answer 29

3. Negligent acts committed by the licensee in he course of his or her real estate
   practice.

Question 30

You are taking a client through a house that was built in 1930. You notice that the electrical plugs in the home have only two holes in them. This is known as:

1. Fiber optic wiring
2. Aluminum wiring
3. Fused wiring
4. Knob and tube wiring

Answer 30

4. Knob and tube wiring

Question 31

Which of the following contractual clauses in a mortgage will not apply when the borrower defaults?

1. A “lender’s remedies” clause
2. A “sales” clause
3. An “acceleration” clause
4. A “mortgage in possession” clause

Answer 31

2. A “sales” clause

Question 32

The investment method of appraisal is generally used for

1. Properties that produce rental income.
2. Single family homes
3. Air space rights.
4. Properties that possess latent value.

Answer 32

1. Properties that produce rental income.

Question 33

Which of the following statements regarding generally accounting principles are FALSE?
A The materiality principle holds that changes to accounting principle should only
be made when the change results in providing more relevant and useful information
to the user of the financial statements.
B. The consistency principle is closely aligned to the cost principle because the best
way to ensure objectivity in accounting transaction is to record the amount of
consideration given up at the date of the transaction.
C. To conform with the cost principle, it is not appropriate to record the asset at
what might be considered its fair market value, the asset should be recorded at the
amount that the enterprise paid for it.
D. The matching principle requires the accrual basis of accounting, that is, expenses
are always incurred, which is not necessary when they are paid.

1. Only statements A and D are false
2. Only statements C and D are false
3. Only statements A and B are false
4. All of the above statements are false

Answer 33

3. Only statements A and B are fals

Question 34

The loss in value caused by outmoded or inadequate design in building is:

1. Salvage value
2. Physical depreciation
3. . Functional depreciation
4. Capital value allowance

Answer 34

3.. Functional depreciation

Question 35

The term ‘security” is used in the mortgage lending usually refers to:

1. The interest in land given by the borrower to assure that lender… under the
   mortgage will be repaid
2. The amount advanced under the loan.
3. The documentation used in a mortgage transaction.
4. The ability of the lender to make an application to court to foreclosed on the
   property on the event of the default.

Answer 35

1. The interest in land given by the borrower to assure that lender… under the
   mortgage will be repaid

Question 36

According to the Real Estate Service Act, which statements is FALSE?

1. A brokerage must have a managing broker.
2. When using a license, the Real Estate council may impose restrictions of the
   licensee’s license.
3. An individual may be registered independently as a real estate
   representative without being employed by a real estate brokerage.
4. A real estate representative is engaged by his or her brokerage to trade in
   real estate services in the brokerage’s name, on behalf of the brokerage

Answer 36

3. An individual may be registered independently as a real estate
   representative without being employed by a real estate brokerage.

Question 37

The term “mandatory injunction” is defined as”

1. A common law remedy of monetary damages
2. An equitable remedy whereby of a course orders a change in the
   written document.
3. An order requiring a defendant to do a particular thing
4. An order summoning a defendant to appear in court

Answer 37

3. An order requiring a defendant to do a particular thing

Question 38

Which of the following statements is FALSE?

1. So long as the effect is negative, positive words may be used in the document.
2. Restrictive covenants must be intended to run with the land.
3. A restrictive covenant will be presumed to be released if there has been
   temporary inconsistency with it.
4. Significant changes to the character of a neighborhood may render a
   restrictive covenant unenforceable.

Answer 38

3. A restrictive covenant will be presumed to be released if there has been
   temporary inconsistency with it.

Question 39

Which of the following is NOT an example of a breach of the criminal conspiracy code in restraint of trade, section 45(1), of the Competition act

1. An agreement among licensees to fix minimum commission rates on real
   property transactions.
2. An agreement between real estate boards to exclude membership of
   brokerages to a maximum number of member brokerages has been reached.
3. An agreement among licensees to advertise their services as “the best in the
   world”.
4. An agreement among real estate brokerages to allocate markets to certain
   licensees.

Answer 39

3. An agreement among licensees to advertise their services as “the best in the
   world”.

Question 40

A voidable contract is:

1. One which is not binding on either party
2. Unenforceable
3. A contract which one of the parties has an option to cancel
4. One which never actually came into existence and therefore cannot be
   unenforceable.

Answer 40

3. A contract which one of the parties has an option to cancel

Question 41

Which of the following statements is FALSE with respect in regards to an agent?

1. An infant may act as an agent
2. One additional limitation on the capacity for real estate agents, as opposite to common law for other industries, is that they must also be licensed under the Real Estate Services Act.
3. Because the agent represents a party to a contract, to bind the principal the agent also have the capacity to contract on his or her own behalf.
4. None of the above-mentioned statement

Answer 41

3. Because the agent represents a party to a contract, to bind the principal the agent also have the capacity to contract on his or her own behalf.

Question 42

Your client makes an offer of $600,000 to purchase a home …subject to finding an acceptable first mortgage. A lender, who has appraised the property for 590,000 will apply 80% loan to value ratio and a 30% gross debt service ratio. Property taxes are
3,000 per annum and your client has a gross income of $100,000 per a year. What is the amount this lender will advance (rounded to the nearest dollar), if the rate is J2= 3.75, the amortization period is 25 years, and payments are to be made monthly.

1. $472,000
2. $427,740
3. $438,976
4. $480,000

Answer 42

3. $438,976

Question 43

With respect to the scope of an agent’s authority, apparent authority:

1. Arises when an agent’s unauthorized act is later ratified.
2. Results from the operation of the legal doctrine of estoppel
3. Arises when the agent is in a transaction governed by “ customs of the trade”.
4. Describes all agency authority that can be inferred in the agency agreement.

Answer 43

2. Results from the operation of the legal doctrine of estoppel

Question 44

You have recently purchased a mortgage contract that will provide you with quarterly payments of $1,500 over 4 years. The outstanding balance of the loan in the amount of $274,000 will be paid as a last payment. If you pay $250,000 for this mortgage contract, what is your yield expressed as a quarterly periodic rate?

1. 1.149929%
2. 2.898149 %
3. 3.064909%
4. 1.182831%

Answer 44

1. 1.149929%

Question 45

Which of the following are advertising contraventions for which a penalty
may be imposed by the Real Estate Council (RECBC)?
A. A failure to have a team name registered and approved by the RECBC for the
advertising proposes
B. Failure to have all advertising materials approved by the RECBC for the
advertising purposes.
C. Failure to display the name of a licensee’s brokerage on a advertisement in a
easily readable way.
D. Displaying signage that real estate services are provide from a licensee
personal home office.

1. Only statement A
2. Only statement B and C
3. Only statement A, C and D
4. All the above

Answer 45

3. Only statement A, C and D

Question 46

Which of the following statements about federal legislation governing mortgages is FALSE?

1. The Interest Act provides that if ta mortgage agreement requires interest
   payment but does not specify the rate of interest chargeable, the rate allowed
   by law is 5%.
2. The Criminal Law defines a criminal rate of interest as an affective annual
   rate is excess of 60%.
3. The Interest Act gives borrowers the right to attack the rate of interest being
   charged in a mortgage on the basis that the rate is either harsh or
   unconscionable.
4. Section 10 of the Interest Act provides an individual with the right of
   prepayment on his or her mortgage at the expiry of five year from the date of
   the mortgage, if the mortgage provides that it is not payable for more than 5
   years from the date of the mortgage.

Answer 46

4. Section 10 of the Interest Act provides an individual with the right of
   prepayment on his or her mortgage at the expiry of five year from the date of
   the mortgage, if the mortgage provides that it is not payable for more than 5
   years from the date of the mortgage.

Question 47

As a Mortgagor which rate would you prefer:
A. J2 = 4.5
B. J1= 4.2
C. J 365= 4.25

1. Rate A
2. Rate B
3. Rate C
4. Impossible

Answer 47

2. Rate B

Question 48

Which one of the following will not be found of the corporation balance sheet?

1. Retained earnings to date
2. Names of the corporation’s shareholders
3. Original cost of the property owned by a corporation
4. Number of shares issued

Answer 48

2. Names of the corporation’s shareholders

Question 49

The Law and Equity Act contains a provision that is often referred to as the “requirement of writing”; Which of the following accurately summarizes the “requirement of writing”; contained in s. 59 of the Law and Equity Act?

1. A contract respecting land can never be enforced against a party who has not signed it.
2. A contract respecting land must be in writing or it is void.
3. A contract for the sale of land must be contained in one written document.
4. None of the above three statements accurately summarizes the requirement of writing.

Answer 49

4. None of the above three statements accurately summarizes the requirement of writing.

Question 50

Which of the following statements is TRUE in regards to open listing ?

1. An open listing provides better protection to the agent then exclusive listing.
2. In an open listing contract, If the seller disposes of the property to a prospect
   that was not introduced be any of the listing agents, the seller does not pay
   listing agents a commission.
3. While a listing contract is a contact between the brokerage and the seller, the
   buyer is bound to some of the terms contained in the contract.
4. It is not necessary that an exclusive listing contain a specified duration and a
   commencement date.

Answer 50

2. In an open listing contract, If the seller disposes of the property to a prospect
   that was not introduced be any of the listing agents, the seller does not pay
   listing agents a commission

Question 51

Which of the following statements with respect to the contract is TRUE:

1. Frustration can only occur after a contract has been made.
2. If a contract is entered into as the result of a person in a power using his or
   her position to induce a weaker party to enter a contract would not have
   otherwise made, the contract will be frustrated.
3. Frustration occurs where both parties to a contract have made a
   fundamental mistake about the contract, but each makes a different mistake.
4. Frustration will apply if the subject matter of the contract is destroyed before
   the contract is made.

Answer 51

1. Frustration can only occur after a contract has been made.

Question 52

Which of the following scenarios describes activities that are consider to be a breach under the Real Estate Services act or the Canadian Real Estate Business Practice?

A. Tom’s cousin, Marty, is interested in purchasing a property where Tom will
be a licensee. Tom agrees to give Marty $1,000 if Marty’s offer gets accepted.
Marty’s offer was the highest out of 6 offers made and was accepted. Tom
didn’t disclose to the vendor of his agreement with Marty.
B. Albert, a listing agent, receives, in addition to the commission an extra
payment from an unrepresented purchaser for his efforts in the dual agency
situation, but the vendor is aware of it and has no problem with it.
C. John, a managing broker, hires three licensees each of whom works for
another brokerage, on a 6 month contract in order to fill in a number of
spaces in his brokerage, entitling them to commissions.

1. A and B only
2. A and C only
3. B and C only
4. A, B and C

Answer 52

2. A and C only

Question 53

In establishing the actual value of a residential property, the Assessor likely will NOT consider:

1. The present use of the property
2. The current interest rates for mortgages
3. The revenue or rental value of the property
4. The location of the property

Answer 53

2. The current interest rates for mortgages

Question 54

The agency contract that specifies that the real estate agent has the right to negotiate on behalf of the owner with respect to the sale of property, is called:

1. An exclusive listing
2. An absolute listing
3. A general listing
4. A select listing

Answer 54

1. An exclusive listing

Question 55

A local builder negotiates on interest only loan for $445,000, the interest rate is
7%, compounded daily. The loan was given for 2 years, and the interest only
payments are to be made monthly. How much is the interest only payments?

1. $2,614.00
2. $2,558.77
3. $2,595.84
4. $2,603.17

Answer 55

4. $2,603.17

Question 56

Which of the following describes a Replacement Reserve?

1. It is a special fund to be used for emergency only
2. Its an annual sum set aside for replacement, repairs and renovations
3. It’s a written schedule of anticipated costs for replacement of equipment,
   appliances, excluded major roof repairs and renovations
4. It’s a stock of monthly supplies which be periodically replaced

Answer 56

2. Its an annual sum set aside for replacement, repairs and renovations

Question 57

Joists are :

1. Horizontal structural framing members that supports floors and ceilings
2. Trusses that support the roof deck
3. Beams the support walls and floors
4. Made of plywood and cover the walls under the siding

Answer 57

1. Horizontal structural framing members that supports floors and ceilings

Question 58

Canada’s Competition Act regards false or misleading advertisement
Which of the following is FALSE concerning the offense?

1. Both the general impression of the representation as well as its literal meaning are relevant in
   determining whether a breach of the Act has taken place.
2. This offence includes both oral and written representations made to the
   public.
3. To escape liability, the accused must show that he or she took all the care
   that is reasonable person would have taken to determine if the
   representation was true and that the accused, honestly believed it to be true.
4. One test that the courts use to determine whether a statement is misleading
   in the context of real estate licensees is the “ diligent licensee” test.

Answer 58

4. One test that the courts use to determine whether a statement is misleading
   in the context of real estate licensees is the “ diligent licensee” test.

Question 59

One of more the following statements correctly describes the rules in regards
deposits in a commercial tenancy.

A. According to the Commercial Tenancy Act, the amount of a security deposit
must not exceed one month’s rent.
B. Someone who purchases the property from the landlord is not obligated to
return the security deposit to the tenant.
C. Entitlement to the interest accrued on a security deposit, if a matter of
negotiation between the parties.
D. The landlord is not personally liable for the return of the security deposit.

Which of the above statements is/are TRUE?

1. All of the above are true
2. Only B and C are true
3. Only A and C are true
4. Only A and B are true

Answer 59

2. Only B and C are true

Question 60

An appraiser is using the market data approach for his appraisal of a single family house. By proper adjustment the appraiser can use sales prices of all the following properties for comparison purposes, EXCEPT:

1. houses in different neighbourhoods.
2. houses with different square footage.
3. houses recently sold between related parties.
4. houses sold over six months ago.

Answer 60

3. houses recently sold between related parties

Question 61

Which of the following statements is FALSE?

1. An agency relationship is created when two persons agree that one will act on
   behalf of the other
2. An agent who does not disclose to a third party that he or she is she is an agent and
   enters into a contract with a third party, may be held liable as a principal.
3. An agency agreement must be written to be enforceable.
4. The agent can never escape liability for torts committed by the agent on the basis
   that the agent was authorized by the principal to commit them

Answer 61

3. An agency agreement must be written to be enforceable.

Question 62

Which one of the following is NOT one of the legislated obligations imposed on a strata corporation under the Strata Property Act?

1. The obligation to exercise the powers and perform the duties of the strata corporation.
2. The obligation to obtain and maintain property insurance of the common property.
3. The obligation to prepare certain records such as minutes of annual and special general meetings and council meetings.
4. The obligation to manage the common property and common assets of the strata corporation for the benefit of the owners.

Answer 62

1. The obligation to exercise the powers and perform the duties of the strata corporation.

Question 63

Which of the following statement regarding mortgages are TRUE?
A. An insured mortgage is generally referred to as a conventional mortgage.
B. In Canada, an insured loan can only be obtained from the private lenders.
C. In majority of cases, the insurance fee is added onto the loan amount if the borrowers have used their cash for the down payment and other transaction
D. With an insured mortgage, an insurance company guarantees that the lender can recover all of the funds loaned in case of default.

1. Only statements C and D are true
2. Only statements B and C are true
3. Only statements A, C and D are true
4. All of the above are true

Answer 63

1. Only statements C and D are true

Question 64

A borrower has arranged a loan of $285,000 at an interest rate of 5%, compounded semi-annually with payments set at $2,157 per month. What is the time necessary to amortize the loan?

1. Exactly 191.280874401 years
2. Exactly 240 months
3. Approximately 3 years
4. Approximately 16 years

Answer 64

4. Approximately 16 years

Question 65

Which one of the following does NOT facilitate best negotiation principles:

1. Framing the discussions around objective standards
2. Focusing on stating and defending the position of each party
3. Asking the other party exactly why they want what they want
4. Being creative with the generation of ideas

Answer 65

2. Focusing on stating and defending the position of each party

Question 66

Common property in the strata development is:

1. Property that the strata council has a duty to repair and maintain under the
   Government Act
2. Property that an owner may be granted exclusive use of knows as “limited
   common property”.
3. Owned by the strata council to manage in the best interest of the strata
   corporation.
4. Owned by the strata corporation.

Answer 66

2. Property that an owner may be granted exclusive use of knows as “limited
   common property”.

Question 67

The purpose of the Real Estate Development Marketing Act is to protect the public by
requiring developers to:

1. meet any preliminary requirements or approvals applicable to the type of property being
   marketed.
2. assure the purchaser’s title upon purchase.
3. prepare and file a disclosure statement in the form required.
4. All of the above are purposes of the Real Estate Development Marketing Act.

Answer 67

4. All of the above are purposes of the Real Estate Development Marketing Act.

Question 68

A seller has just agreed to sell the house and getting ready to move out. What items can she take with her?

1. Her built-in countertop
2. Her television, which is mounted on the wall.
3. The laminated flooring which were just installed 2 months ago
4. The expensive faucet in the bathroom

Answer 68

2. Her television, which is mounted on the wall.