Unit 8

Question 1

1. A valid listing agreement may be terminated for any of the following reasons EXCEPT
   a. sale of the property.
   b. expiration of the individual broker’s license.
   c. agreement of the parties.
   d. destruction of the premises.

Answer 1

b. expiration of the individual broker’s license.

Question 2

2. By entering into an exclusive agency listing agreement with a seller, a real estate brokerage firm
   a. is not entitled to receive a commission if another agency finds a buyer for the property.
   b. has become the seller’s designated agent.
   c. has become the exclusive agent of the seller, but is not entitled to receive a commission if the seller finds a buyer for the property.
   d. has agreed to renegotiate commission with the seller should another agency offer a lower commission rate.

Answer 2

c. has become the exclusive agent of the seller, but is not entitled to receive a commission if the seller finds a buyer for the property.

Question 3

3. The provision in a listing agreement that may obligate the seller to pay the listing firm a commission after the expiration date of the listing is the
   a. compensation clause.
   b. override clause.
   c. marketing clause.
   d. open listing clause.

Answer 3

b. override clause.

Question 4

4. A building sold for $157,000 with a listing commission rate of 6%. The individual listing broker got 10%; the brokerage firm and the individual selling broker equally split the balance. The individual listing broker’s share is
   a. $942.00.
   b. $1,020.50.
   c. $4,239.00.
   d. $4,710.00.

Answer 4

a. $942.00.

Question 5

5. The type of listing agreement that provides for the payment of a commission to the broker even though the owner makes the sale without the aid of the broker is called an
   a. exclusive right to sell listing.
   b. open listing.
   c. exclusive agency listing.
   d. alternative two listing.

Answer 5

a. exclusive right to sell listing.

Question 6

6. A property owner lists a property for sale with a broker. The owner told the broker during the listing negotiations that he wanted $138,000 for the property, and anything above that amount the broker could keep as commission. The listing with this type of provision is known as
   a. gross listing.
   b. net listing.
   c. open listing.
   d. nonexclusive listing.

Answer 6

b. net listing.

Question 7

7. The owner of listed property can sell the property on her own without having to pay the listing broker a commission under which of the following listing agreements?
   a. Exclusive right to sell listing agreement
   b. Exclusive agency listing agreement
   c. Net listing agreement
   d. Multiple listing service listing agreement

Answer 7

b. Exclusive agency listing agreement

Question 8

8. A property owner signed a 90-day listing agreement with a broker. The owner was killed in an accident before the listing expired. Now the listing is
   a. binding on the owner’s spouse for the remainder of the 90 days.
   b. still in effect as the owner’s intention was clearly defined.
   c. binding only if the broker can produce offers to purchase the property.
   d. terminated automatically upon the death of the principal.

Answer 8

d. terminated automatically upon the death of the principal.

Question 9

9. A listing contract in which the broker’s commission is contingent on the broker being able to produce an acceptable buyer before the property is sold by the owner or another broker is called
   a. an open listing.
   b. a net listing.
   c. an exclusive right to sell listing.
   d. an exclusive agency listing.

Answer 9

a. an open listing.

Question 10

10. All of the following are typical provisions of a listing agreement EXCEPT
    a. the price the seller is asking for the property.
    b. the responsibilities of the buyer.
    c. the responsibilities of the broker.
    d. the compensation to be paid to the listing broker.

Answer 10

b. the responsibilities of the buyer.

Question 11

11. The type of listing agreement that provides the LEAST assurance of earning a commission to the listing broker is the
    a. exclusive right to sell listing.
    b. exclusive agency listing.
    c. open listing.
    d. net listing.

Answer 11

c. open listing.

Question 12

12. If a seller needs to net $50,000 after the sale of a property, what is the minimum acceptable sales price if the selling expenses include a 7% commission and $1,200 in additional settlement expenses?
    a. $53,763.44
    b. $54,784.00
    c. $55,053.76
    d. $55,633.25

Answer 12

c. $55,053.76

Question 13

13. A seller refused to pay a commission to the broker even though there was a valid listing agreement and the broker procured a buyer for the property. What can the broker do to collect his firm’s compensation?
    a. File suit in civil court against the seller
    b. File suit in criminal court
    c. File a complaint with the state real estate commission
    d. Collect the commission from the buyer

Answer 13

a. File suit in civil court against the seller

Question 14

14. Under an exclusive agency listing, the listing broker would be entitled to a commission in all the following situations EXCEPT
    a. broker buys the property personally.
    b. property is sold through another broker.
    c. property is listed in a multiple listing service.
    d. seller sells the property to a real estate licensee.

Answer 14

c. property is listed in a multiple listing service.

Question 15

15. A listing firm would be entitled to commission in all of the following situations
    EXCEPT
    a. the seller’s spouse refuses to sign deed at settlement.
    b. the seller insists on contract terms not in the listing agreement.
    c. the seller has a change of mind after contract formation and refuses to complete the transaction.
    d. the seller refuses to sign an offer that is not for the full listing price

Answer 15

d. the seller refuses to sign an offer that is not for the full listing price

Question 16

16. A typical listing agreement may be terminated by all of the following EXCEPT
    a. mutual agreement.
    b. operation of law.
    c. because the seller can’t find another house to buy.
    d. because of impossibility of performance.

Answer 16

c. because the seller can’t find another house to buy.

Question 17

17. The seller wants to net $165,000 after paying the broker a fee of 6% of the sales price. What is the minimum acceptable gross sales price to the nearest dollar?
    a. $169,850
    b. $174,900
    c. $175,532
    d. $178,745

Answer 17

c. $175,532

Question 18

18. The broker enters into a listing agreement with a seller in which the seller will receive $12,000 from the sale of a lot and the broker will receive any sale proceeds over this amount as brokerage compensation. This type of listing is
    a. a gross listing.
    b. an open listing.
    c. an exclusive agency.
    d. a net listing.

Answer 18

d. a net listing.

Question 19

19. An owner lists a property for sale with a broker. A different broker finds an acceptable buyer for the property. The listing broker was not entitled to receive a commission from the sale. The type of listing contract was most probably an
    a. exclusive right to sell listing agreement.
    b. exclusive agency listing agreement.
    c. open listing agreement.
    d. alternative two listing agreement.

Answer 19

c. open listing agreement.

Question 20

20. The property was listed with two different brokerage companies under open listing agreements. Both firms claim entitlement to a commission from the sale of the property. The broker who is entitled to the commission is the one who
    a. listed the property first.
    b. advertised the property most diligently.
    c. obtained the highest offer.
    d. was the procuring cause of the sale.

Answer 20

d. was the procuring cause of the sale.

Question 21

21. Which of the following statements is TRUE about the North Carolina Residential Property Disclosure Act?
    a. All agents in the transaction should facilitate the timely delivery of the property disclosure report to the buyer.
    b. The property owner must disclose the condition of the listed property or be subject to a three-day rescission period on any contract formed.
    c. All residential sellers are subject to this Act even if a broker is not involved in the transaction.
    d. Buyers must receive the completed disclosure report no later than the beg

Answer 21

a. All agents in the transaction should facilitate the timely delivery of the property disclosure report to the buyer.

Question 22

22. A provisional broker sells another firm’s listing for $150,000. The commission is 6.5% of the sales price. Of this amount, 55% goes to the listing broker, and the remaining 45% belongs to the cooperating broker. If the provisional broker receives 60% of any commission that he generates for the office, he is entitled to receive
    a. $2,632.50.
    b. $3,217.50.
    c. $4,387.50.
    d. $5,850.00.

Answer 22

a. $2,632.50.

Question 23

23. The listing and selling brokers agree to equally share a 7% commission on a $95,900 sale. The listing broker gives the listing licensee 50% of the firm’s commission and the selling broker gives the selling licensee 65% of that firm’s commission. How much does the selling licensee earn from the sale?
    a. $1,678.25
    b. $2,181.73
    c. $3,356.50
    d. $4,363.45

Answer 23

b. $2,181.73

Question 24

24. A parcel of vacant land 80 feet wide and 200 feet deep was sold for $200 per front foot. How much money would an individual agent receive for a 60% share of the 10% commission earned?
    a. $640
    b. $960
    c. $1,600
    d. $2,400

Answer 24

b. $960