Practice Quiz 1

Question 1

Subagent

Answer 1

An individual who has been delegated agency duties by a broker employed by a client, not the client themselves.

Question 2

Multiple Listing Service (MLS)

Answer 2

A subscription available to real estate brokers which pools preliminary information on property listings for publication.

Question 3

Agency Law Disclosure

Answer 3

A form containing real estate agency codes which establish the conduct of real estate licensees when representing others in a real estate transaction, which is delivered to all parties in sales transactions other than for five or more unit residential properties.

Question 4

Clients

Answer 4

Members of the public who retain brokers and agents to perform real estate related services

Question 5

Licensed Activities

Answer 5

Dealing by CalBRE licensees with members of the public to offer, contract for and render real estate brokerage services for compensation.

Question 6

Double-end

Answer 6

Price Fixing

Question 7

Risk Reduction Program

Answer 7

Conflict of Interest

Question 8

Independent Contractor (IC)

Answer 8

Dual Agent

Question 9

Sales Goal

Answer 9

The amount of aftertax income agents and brokers intend to earn as a result of their real estate licensing activities.

Question 10

Listing Agreement

Answer 10

A written employment agreement used by brokers and agents when an owner, buyer, tenant or lender retains a broker to render real estate transactional services as the agent of the client

Question 11

Supra-competitive

Answer 11

A market condition where prices are unfairly set by collusion, preventing others from entering the market and hurting consumers.

Question 12

Turnover Rate

Answer 12

The rate at which a broker loses and replaces agents.

Question 13

Net Listing

Answer 13

A type of listing setting the agent’s fee as all sums received exceeding a net price established by the owner.

Question 14

Affiliated Business Arrangement (ABA)

Answer 14

Referral of a client to a financially controlled business whose earnings are shared with the broker.

Question 15

Agency Relationship

Answer 15

The scope of duties imposed on the broker as arising out of the representation authorized by the employment.

Question 16

Fiduciary Duty

Answer 16

The duty owed by an agent to act in the highest good faith toward their client and not to obtain any advantage over the client by the slightest misrepresentation, concealment, duress or undue influence.

Question 17

Quantum Meruit

Answer 17

Compensation paid to a broker on termination of a listing agreement set as the value of the time, effort and money the broker expended acting on the employment, not based on the lost opportunity of the employment

Question 18

Agency Confirmation Provision

Answer 18

A provision in all purchase agreements and counteroffers disclosing the agency of each broker in the transaction.

Question 19

Employment Relationship

Answer 19

The scope of activities the broker and the broker’s agents are to undertake in the employment of a client.

Question 20

Guaranteed Sale Listing

Answer 20

A variation of the exclusive right-to-sell listing in which the broker agrees to buy the property if the property does not sell during the listing period

Question 21

Due Diligence

Answer 21

The concerted and continuing efforts taken by an agent to meet the objectives of their client.

Question 22

Net Listing

Answer 22

A type of listing setting the agent’s fee as all sums received exceeding a net price established by the owner.

Question 23

Full Listing Offer

Answer 23

A buyer’s or tenant’s offer to buy or lease on terms substantially identical to the employment terms in the owner’s listing agreement with the broker.

Question 24

S1031 Transaction

Answer 24

A sales transaction in which sales proceeds are properly reinvested in a replacement property to qualify any profit realized on the sale as tax exempt.

Question 25

Option to Buy

Answer 25

An agreement granting an irrevocable right to buy property within a specific time period.

Question 26

Exclusive Right-to-Sell Listing Agreement

Answer 26

A written employment agreement by a broker and a seller of real estate employing and entitling the broker to a fee when the property sells during the listing period.

Question 27

Exclusive Agent

Answer 27

An agent who is acting exclusively on behalf of only one party in a transaction.

Question 28

Broker Fee Provision

Answer 28

A clause in employment agreements entered into by brokers and their clients enabling brokers, when acting on behalf of their clients in a transaction, too share fees between themselves at the brokers’ discretion.

Question 29

Option Listing

Answer 29

A variation of the exclusive right-to-sell listing granting the broker an option to buy the property at a predetermined price if the property does not sell during the listing period.

Question 30

Exclusive Right-to-Buy Listing Agreement

Answer 30

A written employment agreement by a broker and a prospective buyer of real estate employing and entitling the broker to a fee when property is purchased during the listing period.

Question 31

Exclusive Agency Listing

Answer 31

A listing agreement employing a broker as the sole agent for the seller of real property under the terms entitling the broker to a fee if the property is sold through any other broker, but not if a sale is negotiated by the owner without the services of an agent.

Question 32

Agency Law Disclosure

Answer 32

A form containing real estate agency codes which establish the conduct of real estate licensees when representing others in a real estate transaction, which is delivered to all parties in sales transactions other than for five or more unit residential properties.

Question 33

Buyer’s Agent

Answer 33

An agent representing the buyer. Also known as a selling agent

Question 34

Open Listing

Answer 34

An employment entered into by a broker to render real estate services on a best-efforts basis for a fee to be paid if they achieve the client’s objective of the employment before the client or another broker independent of the broker first meet the objective, such as locating a buyer or a property.

Question 35

Listing Agreement

Answer 35

A written employment agreement used by brokers and agents when an owner, buyer, tenant or lender retains a broker to render real estate transactional services as the agent of the client.

Question 36

Marketing Package

Answer 36

A property information package handed to prospective buyers containing all the disclosures compiled by the seller’s agent on the listed property.