Real Estate Quiz 11

Question 1

The amount required to construct a new building of equal utility to the building being appraised is:
Select one:
a. Replacement cost 
b. Depreciated cost 
c. Reproduction cost 
d. Current cost

Answer 1

Feedback

The correct answer is: Replacement cost

Question 2

Christina has applied for a mortgage for a condominium that she intends to rent on a weekly basis. The lender has accepted a mortgage that covers the condominium plus all its furnishings. Which type of mortgage has Christina entered into?
Select one:
a. Blanket 
b. Bilateral 
c. Package 
d. Chattel

Answer 2

Feedback

The correct answer is: Package

Question 3

The basic motivation of those individuals who require being important and recognized by others is:
Select one:
a. Self-fulfillment 
b. Self-preservation 
c. Self-identification 
d. Self-esteem

Answer 3

Feedback

The correct answer is: Self-esteem

Question 4

Effective gross income less operating expenses (including reserves for replacements) is equal to:
Select one:
a. Potential gross income 
b. Vacancy and collection losses 
c. Before-tax cash flow 
d. Net operating income

Answer 4

Feedback

The correct answer is: Net operating income

Question 5

Capital gain is calculated on:
Select one:
a. The length of time the asset is owned, its current and former value and the tax bracket of the owner.
b. The tax bracket of the owner.
c. The owner’s agent and income.
d. The value that the owner originally paid for the asset and its taxable value.

Answer 5

Feedback
The correct answer is: The length of time the asset is owned, its current and former value and the tax bracket of the owner.

Question 6

If Effective Gross Income is $50,000, Potential Gross Income is $60,000, and Net Operating Income is $30,000, how much are the Operating Expenses?
Select one:
a. $10,000 
b. $20,000 
c. $30,000 
d. $80,000

Answer 6

Feedback

The correct answer is: $20,000

Question 7

Which of the following remedies allows a seller to keep the deposit in the event of a buyer default?
Select one:
a. Specific performance 
b. Liquidated damages 
c. Unliquidated damages 
d. Rescission

Answer 7

Feedback

The correct answer is: Liquidated damages

Question 8

Which ratio is used to determine if a company has the ability to meet its current obligations without considering its inventory worth?
Select one:
a. Debt-to-net worth ratio 
b. Quick ratio 
c. Inventory turnover ratio 
d. Net profit to owner capital

Answer 8

The correct answer is: Quick ratio

Question 9

The objective of a sales manager is to:
Select one:
a. Hire as many sales associates as possible
b. Maximize the productivity of the firm
c. Increase the efficiency of the staff
d. Motivate the unproductive associates

Answer 9

Feedback

The correct answer is: Maximize the productivity of the firm

Question 10

After accepting a deed in lieu of foreclosure, Shifty Bank discovers that hazardous substances are present on the subject property. They immediately, and prudently, notify the EPA of the condition. Is Shifty Bank liable for the cost of cleanup?
Select one:
a. Since the bank did not own the property at the time of contamination, the bank is not liable
b. Since the bank acted prudently after discovering the condition, the bank can declare Innocent Landowner Defense
c. The bank is liable because it is now the present owner
d. Only the former owner before the bank is liable

Answer 10

Feedback

The correct answer is: The bank is liable because it is now the present owner