NC Basic Real Estate Concepts

Question 1

Physical characteristics of land include all of the following EXCEPT

A)
immobility.
B)
indestructability.
C)
location.
D)
uniqueness.

Answer 1

C)
location.

Explanation
Location is and economic characteristic of land. Location is very important in determining value.

Reference: Basic Real Estate Concepts

Question 2

What gives owners the greatest return on their investment?

A)
Government land use controls
B)
Investment in a real estate trust
C)
Highest and best use
D)
Principal of supply and demand

Answer 2

C)
Highest and best use

Explanation
Highest and best use can change over time, but only has one highest and best use at a time. Highest and best use will generate the greatest net return.

Reference: Basic Real Estate Concepts

Question 3

Inregards to supply and demand, what areas affect supply?

A)
Population, labor force, government control, and financial policies
B)
Labor force, demographics, employment, and wage levels
C)
Government control, wage levels, financial policies, and labor force
D)
Construction costs, labor force, financial policies, and government controls

Answer 3

D)
Construction costs, labor force, financial policies, and government controls

Explanation
Population, demographics, employment, and wage levels all affect demand. Construction costs, labor force, financial policies, and government controls affect supply.

Reference: Basic Real Estate Concepts

Question 4

Which of the following would be considered commercial property?

A)
A textile mill
B)
A church
C)
A subdivision
D)
A movie theatre

Answer 4

D)
A movie theatre

Explanation
Movie theaters fall under the commercial property classification.

Reference: Basic Real Estate Concepts

Question 5

In which of the following situations do you need a real estate license?

A)
Helping your friend sell their home for a free boat
B)
Helping your parents sell their home
C)
Selling your own home
D)
Renting a home, you own, on a three year lease

Answer 5

A)
Helping your friend sell their home for a free boat

Explanation
Selling real property for others, for compensation, requires a license. You need a license when you are listing, leasing, buying, exchanging, auctioning, negotiating, or selling real property for others for compensation. A free boat is considered compensation.

Reference: Basic Real Estate Concepts