Unit quiz 16 Flashcards
The owners of a modest ranch house in a neighborhood of larger, more expensive homes may find that the value of their home is affected by what principle?
Progression
Which of the following is NOT used by an appraiser applying the income approach to value?
A) Capitalization rate
B) Annual gross income
C) Accrued depreciation
D) Annual net operating income
C) Accrued depreciation
Depreciation is one of the calculations used in
the replacement (cost) approach to value
Which appraisal method uses a rate of investment return?
A) Gross income multiplier method
B) Cost approach
C) Income approach
D) Sales comparison approach
C) Income approach
A homeowner constructs a five-bedroom brick house with an indoor pool in a neighborhood of modest two-bedroom and three-bedroom frame houses on narrow lots. The value of this house is MOST likely to be affected by what principle?
A) Change
B) Assemblage
C) Progression
D) Regression
D) Regression
Appraisers are expected to follow the
A) directions of the real estate broker as to expectations of value.
B) directions of the client as to expectations of value.
C) directions of the mortgage lender as to expectations of value.
D) Uniform Standards of Professional Appraisal Practice (USPAP).
D) Uniform Standards of Professional Appraisal Practice (USPAP).
the Uniform Standards of Professional Appraisal Practice (USPAP) that are established by
the Appraisal Standards Board of the Appraisal Foundation.
The acronym BPO stands for
broker’s price opinion.
The market value of a parcel of real estate is
A) an estimate of its future benefits.
B) the amount of money paid for the property.
C) its value without improvements.
D) an estimate of the most probable price it should bring.
D) an estimate of the most probable price it should bring.
A building was purchased new five years ago for $240,000. It currently has an estimated remaining useful life of 55 years. What is the property’s total depreciation to date for appraisal purposes?
$20,000
The structure has 60 years of economic life, of which 5 have been used. Therefore, the calculations are as follows: $240,000 purchase price ÷ 60 years = $4,000 depreciation per year. Because five years have passed, $20,000 in total depreciation has occurred: 5 years × $4,000 depreciation per year = $20,000 accrued depreciation.
The number of years during which an improvement will add value to land.
Economic Life
A homeowner constructs an eight-bedroom brick house with a tennis court, a greenhouse, and an indoor pool in a neighborhood of modest two-bedroom and three-bedroom frame houses on narrow lots. The value of this house is MOST likely to be affected by what principle?
A) Change
B) Assemblage
C) Progression
D) Regression
D) Regression
The value of larger lavish homes in a modest neighborhood will be drawn down by the presence of modest, less-lavish homes. Regression is the opposite of progression.
A broker’s price opinion (BPO) should not be confused with an appraisal, which consists of a more in-depth analysis of gathered information and
A) for which the broker charges more.
B) which requires more work by the broker.
C) which may be performed by the broker under the supervision of a licensed appraiser.
D) which may be performed only by a licensed or certified appraiser.
D) which may be performed only by a licensed or certified appraiser.
The characteristics of value include which of the following?
A) Competition
B) Scarcity
C) Anticipation
D) Balance
B) Scarcity
The characteristics of value are remembered by the acronym
DUST: demand, utility, scarcity, and transferability.
