Nat 5

Question 1

An invitation to enter into a contract

Answer 1

Offer

Question 2

Money given by the buyer to show good faith intention to compleat the contract

Answer 2

Earnest money

Question 3

Arizona law requires that unless otherwise agreed to in writing, the broker must place earnest money in a

Answer 3

Trust account or escrow

Question 4

Clause that makes the sale contingent upon a certain event

Answer 4

Contingency clause

Question 5

Makes the sale contingent upon the buyer obtaining financing

Answer 5

Mortgage contingency clause

Question 6

The amount pre-determined by the parties as the total amount of compensation an injured party should receive if the the other party breaches a specified part of the contract

Answer 6

Liquidated damages

Question 7

A court order to enforce the terms of a contract

Answer 7

Specific performance

Question 8

Making over statements of personal opinion

Answer 8

Puffing

Question 9

False statements of material facts

Answer 9

Misrepresentation

Question 10

Occurred when a person intentionally misrepresents facts

Answer 10

Fraudulent misrepresentation

Question 11

Insurance that insures licensees against errors or omissions the agent makes

Answer 11

Errors and omissions (E&O) insurance

Question 12

Provision whereby one party agrees to protect another party from damages or lawsuits
AKA hold harmless clause

Answer 12

Indemnification clause

Question 13

The legal remedy of canceling a contract and restoring the parties to their original positions prior to entering into the contract

Answer 13

Rescission of contract

Question 14

A dispute resolution process conducted by an independent third party mediator who works with the parties to help resolve their differences

Answer 14

Mediation

Question 15

The non-judicial submission of a dispute to a third party arbitrator with both parties agreeing in advance to comply with the final decision of the arbitrator

Answer 15

Arbitration