Module 12

Question 1

Which principle states that the property with the lowest price attracts the greatest demand and widest distribution when several competing properties are available?

Answer 1

Substitution

Question 2

Four forces impact value. Employment levels, wage rates, and interest rates are examples of which force?

Answer 2

economic

Question 3

Which principle states that real estate value is created and sustained when the characteristics of a property correspond to the demands of its market?

Answer 3

conformity

Question 4

The elements that create wealth, income, or services when they are combined are known as _____-

Answer 4

agents of production

Question 5

A temporary use of a property until a different use becomes maximally productive is

Answer 5

interim use

Question 6

Zoning, public transportation, and sales taxes are examples of which of the four forces impacting value?

Answer 6

governmental and legal

Question 7

A small average residence is located in an area of luxury homes. The effect of the surrounding homes on the small residence is called

Answer 7

progression

Question 8

In an office market that has more available space than tenants willing to rent, what principle will affect pricing the most?

Answer 8

competition

Question 9

Which theory states that land cannot be valued on the basis of one use while the improvements are valued on the basis of another use?

Answer 9

consistent use

Question 10

An owner continues to make improvements to a property to the point where the value is no longer enhanced. What subgroup principle of balance does this illustrate?

Answer 10

increasing and decreasing returns

Question 11

Ellis built his residence on two lots in a manner that makes it impossible to subdivide the land. The land site situation that Ellis has is an example of what?

Answer 11

Surplus land