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National Real Estate Exam Questions with answers, Rated A. 2022/2023 updates, Graded A

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National Real Estate Exam Questions with answers, Rated A. 2022/2023 updates, Graded A 1. Efforts to increase homeownership include all the following EXCEPT A) requiring lower down payments. ... B) penalizing first-time homebuyers for using funds from IRA's. C) requiring loan applicants to have better credit. D) lowering closing costs for first-time home buyers. - ✔✔C) requiring loan applicants to have better credit. The real cost of owning a home includes certain costs/expenses that many people overlook. Which of the following is NOT such a cost/expense of home ownership? A) Income lost on cash invested in the home B) Interest paid on borrowed capital C) Maintenance and repair expenses D) Personal property taxes - ✔✔D) Personal property taxes Margie listed her real estate for sale at $100,000. If her cost was 80 percent of the listing price, what will her percentage of profit be when her real estate is sold for the listing price? A) 10 percent B) 15 percent C) 20 percent D) 25 percent - ✔✔D) 25 percent Most homeowner's insurance policies contain which of the following clauses? A) A property improvement clause B) A coinsurance clause C) A co-ownership clause D) A property devaluation clause - ✔✔B) A coinsurance clause That portion of the value of owners' property that exceeds the amount of their mortgage debt is called A) equality. B) escrow. C) surplus. D) equity. - ✔✔D) equity. Homeowners may deduct all of the following expenses when preparing their income tax return EXCEPT A) real estate taxes. B) mortgage interest on a first home. C) mortgage interest on a second home. D) mortgage interest on a third home. - ✔✔D) mortgage interest on a third home. If a homeowner's insurance policy provides coverage for less than 80 percent of the full replacement cost of the dwelling, then the loss of the residence will be settled for A) the market value of the property less the land value. B) the lowest repair bid. C) either the actual cash value or the prorated repair cost. D) the total replacement cost. - ✔✔C) either the actual cash value or the prorated repair cost. The Levines sold their vacation home for $188,000. If they made a profit of 10 percent, what was the original cost of their property? A) $169, 200 B) $179,000 C) $179,200 D) $170,900 - ✔✔D) $170,900 The selling price of a property is $96,000. This can be financed if the buyer can put 10 percent down and pay a loan origination fee of 1.5 percent. How much cash must the buyer produce to complete this transaction? A) $10,080 B) $10,896 C) $11,040 D) $11,084 - ✔✔B) $10,896 Federal income tax law excludes gain realized on the sale of a primary residence for individuals filing separately and for couples filing jointly. The amount of this exclusion is (separately/jointly): A) $100,000/$200,000 B) $125,000/$250,000 C) $250,000/$500,000 D) $300,000/$600,000 - ✔✔C) $250,000/$500,000 Damage from which of the following is NOT covered in a basic homeowner's policy? A) Fire and lightning B) Explosion C) Windstorm and hail D) Flood - ✔✔D) Flood Federal income tax regulations allow homeowners to reduce their taxable income by amounts paid for A) repairs and maintenance. B) hazard insurance premiums. C) real estate taxes. D) principal and interest. - ✔✔C) real estate taxes. When Homeowner Harry's sold his residence recently, he found that he had more than $20,000 in equity. This equity did NOT come from A) the use of an interest-only mortgage payment plan. B) the principal portion of his PITI monthly mortgage payments. C) increases in market value of his house due to appreciation and inflation. D) his down payment. - ✔✔A) the use of an interest-only mortgage payment plan. The buyer of a $125,000 home has paid $2,000 as earnest money and has a loan commitment for 70 percent of the purchase price. The balance of the cash the buyer needs to complete the transaction is A) $3,500. B) $35,500. C) $37,000. D) $37,500. - ✔✔B) $35,500. Which of the following type of development combines office space, stores, and residential units in a single, vertical community known as a A) planed unit development B) manufactured housing park C) mixed -use development D) time-share community - ✔✔C) mixed -use development Three years ago Dr. and Mrs. Henderson moved from the house they had owned for 20 years, but did not sell it. They decided to travel and bought a mobile home to live in. They now sell the house. How much of their capital gain on the house will be taxable? A) 15 percent, depending on their tax bracket B) 28 percent, depending on their tax bracket C) All of it, if it is over $500,000 D) None of it, if it is less than $500,000 - ✔✔D) None of it, if it is less than $500,000 The purchaser of a property in a planned unit development will usually NOT receive A) an interest in the unit owners' association. B) a direct ownership interest in the common areas. C) title to the land on which the unit is built. D) a share in the control of the commonly-owned elements. - ✔✔B) a direct ownership interest in the common areas. The phrase "bundle of legal rights" is properly included in A) the definition of real property. B) a legal description. C) real estate transactions. D) leases for less than one year. - ✔✔A) the definition of real property. All of the following are included in the right to control one's property EXCEPT A) The right to sell the property to a neighbor B) The right to exclude the utilities' meter reader C) The right to erect "no trespassing" signs D) The right to enjoy profits from its ownership - ✔✔B) The right to exclude the utilities' meter reader According to law, a trade fixture is usually treated as A) a fixture. B) an easement. C) personalty. D) a license. - ✔✔C) personalty. Kandace is interested in a house that fits most of her needs, but it is located in a busy area where she is not sure she wants to live. Her concern about the property's location is called A) physical deterioration. B) area preference. C) permanence of investment. D) immobility. - ✔✔B) area preference. Which of the following is considered personal property? A) Wood-burning fireplace B) Awnings C) Bathtubs D) Patio furniture - ✔✔D) Patio furniture All of the following are properly described by the word "improvement" EXCEPT A) Streets B) A sanitary sewer system C) Trade fixtures D) The foundation of a building - ✔✔C) Trade fixtures Real property can become personal property by A) severance. B) purchase. C) hypothecation. D) attachment. - ✔✔A) severance. All of the following are physical characteristics of land EXCEPT A) Indestructibility B) Uniqueness C) Immobility D) Scarcity - ✔✔D) Scarcity A broker showed an owner-occupied property that had window screens, custom venetian blinds, and a wall bed to a buyer whose offer was then accepted by the owner. Before the close of escrow, the seller may remove A) all of the identified items because they are trade fixtures. B) only the venetian blinds as personal property. C) only the wall bed because it is real property. D) none of the identified items. - ✔✔D) none of the identified items. Land is considered to be A) indestructible. B) a wasting asset. C) immune to the forces of supply and demand. D) subject to personal property rights. - ✔✔A) indestructible. A rancher owns a parcel of land on which oil is discovered. If the rancher has not previously conveyed the oil rights, who owns the oil? A) The rancher B) The tenant to whom the property has been leased C) The state government D) The federal government - ✔✔A) The rancher The type of housing which can become permanent if affixed to the land is called A) on-site built B) semi-detached single family C) manufactured D) multi-family - ✔✔C) manufactured All of the following are treated as personal property EXCEPT A) Chattels B) Trade fixtures C) Emblements D) Fructus naturales - ✔✔D) Fructus naturales Fixtures are A) treated as real property. B) considered to be chattels. C) removable by a tenant before the expiration of the lease. D) removable by a tenant after the expiration of the lease. - ✔✔A) treated as real property. After the construction of a building in the air rights above a railroad right-of-way, the trains can A) operate as usual. B) no longer use the tracks under the building. C) use the tracks under the building only if they cause no problem for the building's occupants. D) use the tracks under the building as long as they first obtain the building owner's permission. - ✔✔A) operate as usual. All of the following are economic characteristics of land EXCEPT A) scarcity. B) permanence of investment. C) uniqueness. D) area preference. - ✔✔C) uniqueness. Generally, personal property can be distinguished from real property by its A) greater variety. B) mobility. C) cost. D) multiplicity of use. - ✔✔B) mobility. An important characteristic of land is that it may be modified or improved at some point in time. Depending on its type, an improvement may increase the value of real estate greatly. All of the following are considered to be improvements EXCEPT A) Sewers B) Crops C) Buildings D) Roads - ✔✔B) Crops Tonya leases store space to Klem for a restaurant, and Klem installs his ovens, booths, counters, and other equipment. When would these items become real property? A) After they are installed B) After Klem defaults on his rental payments C) After the lease takes effect D) If Klem does not remove them at lease expiration - ✔✔D) If Klem does not remove them at lease expiration Rights or privileges which are connected with real property, are A) improvements B) appurtenances C) not conveyed with the real estate D) restricted to air and water rights - ✔✔B) appurtenances The term improvements, when referring to real estate, would include A) shrubbery. B) trees. C) sidewalks. D) lawns. - ✔✔C) sidewalks. Which of the following is NOT a test to identify a fixture? A) Intent of the parties B) Size of the item C) Method of attachment of the item D) Adaptation of the item to the real estate - ✔✔B) Size of the item The owner of a house wants to fence the yard for her dog. When the fence is erected, the fencing materials are converted to real estate by A) severance. B) annexation. C) immobility. D) indestructibility. - ✔✔B) annexation. The uniqueness of land and its inability to be substituted is known as A) Nonhomogenity B) Scarcity C) Permanence of investment D) Nonheterogenity - ✔✔A) Nonhomogenity The rights of ownership of real property include all of the following EXCEPT the right of A) disposition. B) exclusion. C) control. D) compatibility. - ✔✔D) compatibility. A bill of sale is used to transfer the ownership of A) real property. B) fixtures. C) personal property. D) appurtenances. - ✔✔C) personal property. A real estate broker's responsibility to keep the principal informed of all of the facts that could affect a transaction is the duty of A) care. B) disclosure. C) obedience. D) accounting. - ✔✔B) disclosure. Which of the following would be considered dual agency? A) A broker's acting for both the buyer and the seller in the same transaction B) Two brokerage companies' cooperating with each other C) A broker's representing more than one principal D) A broker's listing and then selling the same property - ✔✔A) A broker's acting for both the buyer and the seller in the same transaction The relationship of a broker to his or her client is that of a(n) A) trustee. B) subagent. C) fiduciary. D) attorney in fact. - ✔✔C) fiduciary. A real estate broker acting as the agent of the seller A) must promote and safeguard the seller's best interest B) can disclose the seller's minimum price. C) should present to the seller only the highest offer for the property. D) can accept an offer on behalf of the seller. - ✔✔A) must promote and safeguard the seller's best interest In designated agency all of the following apply EXCEPT A) the broker could be a dual agent B) the same agent may represent both the buyer and the seller at the same time C) the broker can choose an agent in the office to represent the seller D) the broker may appoint an agent to negotiate for the buyer - ✔✔B) the same agent may represent both the buyer and the seller at the same time A broker is permitted to represent both the seller and the buyer in the same transaction when A) the principals are not aware of such action. B) the broker is a subagent rather than the agent of the seller. C) commissions are collected from both parties. D) both parties have been informed and agree to the dual representation. - ✔✔D) both parties have been informed and agree to the dual representation. Which of the following would be considered lawful practice in real estate brokerage? A) Deceitful or dishonest practices B) Exaggerated statements about the property C) Omitted statements of material fact D) Misstatements about the property - ✔✔B) Exaggerated statements about the property As an agent for the seller, a real estate broker can A) guarantee a prospective buyer that the seller will accept an offer at the listed price and terms B) solicit an offer to purchase the property from a prospective buyer. C) advise a prospective buyer as to the best manner of taking title to the property. D) change the terms of the listing contract on behalf of the seller. - ✔✔B) solicit an offer to purchase the property from a prospective buyer. A seller has listed her home with a broker for $190,000. The listing broker tells a prospective buyer to submit a low offer because the seller is desperate to sell. The buyer offers $185,000 and the seller accepts it. In this situation, A) the broker has violated his agency relationship with the seller. B) the broker was unethical, but the seller did get to sell her property. C) the broker acted properly to obtain a quick offer on the property. D) any broker is authorized to encourage such bids for the property. - ✔✔A) the broker has violated his agency relationship with the seller. When Broker Hearn was told by his principal not to advertise her property in a certain newspaper, which was out of the area, Hearn complied because he A) had never advertised in that newspaper anyway. B) must obey the lawful instructions of his principal. C) was NOT intending to advertise the property at all. D) is allowed to advertise only in local newspapers. - ✔✔B) must obey the lawful instructions of his principal. It is the duty of an agent to disclose to the principal every material step taken in the transaction of the principal's business. This is because the A) commission can be adjusted up or down according to the agent's efforts. B) agent has fiduciary obligations to the principal. C) terms of the listing contract require the agent to do so. D) terms of the purchase contract require the agent to do so. - ✔✔B) agent has fiduciary obligations to the principal. Upon discovering a latent defect in a property, the Broker Alice should discuss the problem with seller Juan and then A) tell him that the defect must be repaired. B) arrange for the repairs herself. C) inform any prospective buyers of the defect. D) contact the city building inspector about the defect. - ✔✔C) inform any prospective buyers of the defect. The type of agency practiced in which there is only ever one client is A) designated agency B) disclosed dual agency C) exclusive buyer agency D) single agency - ✔✔D) single agency A salesperson who is employed by a broker told a prospective buyer that the house she was looking at is "the best house in the area." Because of this statement, A) the salesperson was guilty of fraud. B) the broker was guilty of fraud because the employing broker is responsible for the actions of the sales person. C) the salesperson was practicing puffing. D) the salesperson would be guilty of fraud only if the buyer purchased the house. - ✔✔C) the salesperson was practicing puffing. Which of the following best defines the law of agency? A) The selling of another's property by a properly licensed brokerage company B) The rules of law that apply to the responsibilities of a person who acts as agent for another C) The principles that govern one's conduct in business D) The rules and regulations of the state's licensing agency - ✔✔B) The rules of law that apply to the responsibilities of a person who acts as agent for another A broker who is the agent of the buyer should do which of the following? A) Disclose to the seller that the buyer is a minority person B) Disclose to the seller the maximum price the buyer is willing to pay C) Present to the seller only offers that are acceptable D) Advise the buyer if the listing price of the seller's house is unrealistic - ✔✔D) Advise the buyer if the listing price of the seller's house is unrealistic A salesperson sells buyer Fred property listed by another brokerage firm in the Multiple Listing System. The salesperson has been working with Fred for many months but does not have an agency contract with him. This salesperson has fiduciary obligations to A) the seller. B) the buyer. C) no one. D) the public. - ✔✔A) the seller. Broker Joan shows properties listed for sale with her company to prospect Karl. Karl has refused buyer representation. Karl is Joan's A) client. B) principal. C) customer. D) fiduciary. - ✔✔C) customer. Mr. Mole's house has been listed for sale for more than one year and he is very anxious to move into a retirement community. Salesperson Rachel, who is a subagent of the seller, tells a prospective buyer to make a low offer because she is sure that the seller will accept it. Regarding Rachel's conduct, all of the following would be true Except? A) She acted appropriately to get the seller's property sold. B) She violated her fiduciary duty to Mr. Mole. C) Her conduct implies she is representing the buyer. D) She should not assume that an anxious seller will accept a lower offer. - ✔✔A) She acted appropriately to get the seller's property sold. A salesperson who represents the seller is showing a house to a prospective buyercustomer. The salesperson knows that the house has water problems in its basement. Which of the following is true? A) Withholding the information properly protects the confidence of the seller. B) Disclosing the information could create a fiduciary relationship with the buyer. C) Withholding the information prevents the buyer from making an informed decision. D) Disclosing the information violates the salesperson's fiduciary duty to the seller. - ✔✔C) Withholding the information prevents the buyer from making an informed decision. Broker Sven, in the course of selling a home to customer Nancy, told her that the foundation was "solid as a rock" when he knew for a fact that it was slowly sinking into the landfill on which it was built. Now that the sale is settled, which of the following is LEAST LIKELY to happen to Sven? A) Revocation of his license for failure to disclose a material fact B) Successful defense against all charges based on loyalty to his client-seller C) Being charged with intentional misrepresentation D) Suit to recover money damages experienced by Nancy due to basement leakage - ✔✔B) Successful defense against all charges based on loyalty to his client-seller Broker LaRue's newest salesperson, Shandra, lists a unit in a condominium building for sale. In this transaction Shandra A) has a direct contractual relationship with the owners of the unit. B) acts on behalf of LaRue, her broker. C) acts on behalf of the condominium association. D) must personally find a buyer for the unit to obtain a share of the commission. - ✔✔B) acts on behalf of LaRue, her broker. A broker who represents a seller under an exclusive-agency listing receives two offers for the property at the same time, one from one of his salespeople and one from the salesperson of a cooperating broker. What should the broker do? A) Submit the offer from his salesperson first B) Submit the offer from the other salesperson first C) Submit the higher offer first D) Submit both offers at the same time - ✔✔D) Submit both offers at the same time Two salespeople working for the same broker obtained offers on a property listed with their firm. The first offer was obtained early in the day. A second offer for a higher purchase price was obtained later in the afternoon. The broker presented the first offer to the seller that evening. The broker did not inform the seller about the second offer so that the seller could make an informed decision about the first offer. Which of the following is true? A) The broker's actions are permissible provided the commission is split between the two salespeople. B) After the first offer was received the broker should have told the salespeople that no additional offers would be accepted until the seller decided on the offer. C) The broker has no authority to withhold any offers from the seller. D) The broker was smart to protect the seller from getting into a negotiating battle over two offers. - ✔✔C) The broker has no authority to withhold any offers from the seller. A broker has an exclusive-right-to-sell listing on a building. The owner is out of town when the broker gets an offer from a buyer to purchase the building providing the seller agrees to take a purchase money mortgage. The buyer must have a commitment from the seller before the seller is scheduled to return to the city. Under these circumstances the A) broker may enter into a binding agreement on behalf of the seller. B) broker may collect a commission even if the transaction falls through because of the seller's absence from the city. C) the buyer is obligated to keep the offer open until the seller returns. D) the broker must obtain the signature of the seller to effect a contract. - ✔✔D) the broker must obtain the signature of the seller to effect a contract. A property manager is hired to manage a property while the owner is overseas for two years. The property manage is a (n) A) general agent B) special agent C) universal agent D) attorney-in-fact - ✔✔A) general agent The amount of commission that is paid to salesperson Sharise is determined by A) state law. B) the local real estate board. C) mutual agreement with her broker. D) mutual agreement with the client. - ✔✔C) mutual agreement with her broker. Broker Janna was accused of violating antitrust laws. Of the following, she was most likely accused of A) not having an equal housing opportunity sign in her office window. B) undisclosed dual agencies. C) price fixing. D) dealing in unlicensed exchange services. - ✔✔C) price fixing. Real estate broker Todd was responsible for a chain of events that resulted in the sale of one of his client's properties. This is referred to as A) pro forma. B) procuring cause. C) private offering. D) proffered offer. - ✔✔B) procuring cause. Salesperson Norman wants to be classified as a qualified real estate agent—the equivalent of holding independent contractor status. All of the following are requirements for him to meet EXCEPT A) Receive substantially all of his income from the brokerage based on production, not time worked B) Be free from supervision by his broker and office manager C) Hold a current real estate license D) Have a written agreement with his broker stating that he will not be treated as an employee for federal tax purposes - ✔✔B) Be free from supervision by his broker and office manager A parcel of vacant land 80 feet wide and 200 feet deep was sold for $200 per front foot. How much money would a salesperson receive for her 60 percent share in the 10 percent commission? A) $640 B) $960 C) $1,600 D) $2,400 - ✔✔B) $960 A real estate salesperson, classified by the IRS as an independent contractor, receives A) a monthly salary or hourly wage. B) company-provided health insurance. C) company-provided automobile. D) negotiated commissions on transactions. - ✔✔D) negotiated commissions on transactions. In a typical agency relationship between broker and client, the broker's commission is determined by A) state law. B) the local real estate board. C) mutual agreement. D) minimums based on the property type. - ✔✔C) mutual agreement. Salesperson Nellie finally concluded some extremely difficult negotiations that resulted in the sale of a listed parcel of land. For all of her extra efforts, she can legally receive a performance bonus from A) the seller. B) the buyer. C) no one. D) her broker. - ✔✔D) her broker. Wella is a salesperson working for Broker Vincent. Wella sells a $150,000 home listed with another brokerage. The listing commission is 6.5 percent of the selling price. Of this amount, 5 percent is payable to the referral network that referred the buyer, 35 percent goes to the listing broker, and 60 percent belongs to the cooperating broker. Broker Vincent and Wella agreed that she would receive 55 percent of any commission that she generated for their office. For this transaction, she is entitled to receive A) $2,632.50 B) $3,217.50 C) $3,412.50 D) $5,850.00 - ✔✔B) $3,217.50 All of the following are required of a broker when seeking to collect a commission for brokering the sale of a property EXCEPT A) Having a valid real estate broker's license B) Having been procuring cause in the transaction or having an exclusive-right-to-sell agreement C) Having had a contract of employment—an agency representation agreement D) Complying with a set commission rate set by a trade organization - ✔✔D) Complying with a set commission rate set by a trade organization A broker lists a property for sale at $100,000 with a 5 percent commission, and he later obtains an oral offer from a prospective buyer to purchase the property. The seller indicates to the broker that the offer would be acceptable if it were submitted in writing. Before it can be put in writing, the buyer backs out and revokes the oral offer. In this situation, the broker would be entitled to A) a commission of $5,000. B) only a partial commission. C) no commission. D) the normal rate of commission. - ✔✔C) no commission. All of the following are prohibited under the antitrust laws EXCEPT A) Competing property management companies' agreeing to standardized management fees B) Competing brokers' allocating markets based on the value of homes C) Real estate companies' agreeing NOT to cooperate with a broker because of the fees that broker charges D) A broker's setting a company commission schedule - ✔✔D) A broker's setting a company commission schedule Landowner Shelley subdivides her acreage and offers the lots for sale. Broker Ernie tells her that he can sell the lots. After Ernie sells some of the lots, the landowner refuses to pay him a commission. The broker can A) report the landowner to the real estate licensing authorities. B) file a lien against the landowner's remaining lots. C) sue the landowner for breach of contract. D) do nothing. - ✔✔D) do nothing. There is a spectacular house that salesperson Rameses from Aida Realty has been trying for several weeks to list for sale. The owners have been interviewing salespeople from different firms. They tell Aida's Ramses that Botchko Properties will charge a 2 percent lower commission for selling the house. What should Aida's salesperson say to the owner in order to get the listing? A) Salespeople will not show Botchko's listings because of their low commission fees. B) Most brokers in the area charge a standard rate of commission, including Aida. C) The Botchko firm cannot provide good services because they charge less. D) Aida Realty provides excellent services to market their sellers' properties. - ✔✔D) Aida Realty provides excellent services to market their sellers' properties. Broker Smith is helping a buyer and seller fill out a sales contract, but is not representing either party. Broker Smith is a(n) A) transactional broker B) designated broker C) traditional broker D) unlicensed broker - ✔✔A) transactional broker The listing and the selling broker agree to split a 7 percent commission 50-50on a $196,900 sale. The listing broker gives the listing salesperson 30 percent of his commission, and the selling broker gives the selling salesperson 35 percent of his commission. How much does the selling salesperson earn from the sale? A) $4,824.05 B) $1,174.78 C) $1,206.01 D) $2,412.03 - ✔✔D) $2,412.03 Unless some other written agreement has been made, broker Hugo will usually receive his brokerage commission when A) the purchaser takes possession of the property. B) the seller lists the property with the broker. C) the transaction is closed. D) an offer, procured from a ready, willing, and able buyer, has been accepted by the seller. - ✔✔C) the transaction is closed. "Fee- for-services" means A) offering real estate services in a piecemeal fashion B) allowing non-licensees to conduct real estate transactions C) working only with for-sale-by-owners D) providing consumers all the same services for a discounted price - ✔✔A) offering real estate services in a piecemeal fashion Each of two brokerage companies claimed full commission for the sale of a property that was listed by both of the firms under open listing agreements. The broker who is entitled to the commission is the one who A) listed the property. B) advertised the property. C) obtained the first offer. D) was the procuring cause of the sale. - ✔✔D) was the procuring cause of the sale. The National Do-Not-Call Registry provides that A) licensees may never contact consumers without written authorization B) consumers with whom a licensee has had a business relationship can be contacted for up to 12 months after the purchase C) licensees may not contact a previous customer if the are the Registry D) consumers who have made an inquiry to a licensee may be contacted up to 3 months later - ✔✔D) consumers who have made an inquiry to a licensee may be contacted up to 3 months later All of the following reasons are valid bases for terminating a listing agreement EXCEPT A) Sale of the property B) Death of the salesperson C) Agreement of the parties D) Destruction of the premises - ✔✔B) Death of the salesperson By executing a listing agreement with a seller, a real estate broker becomes A) a procuring cause. B) obligated to open a special trust account. C) the agent of the seller. D) responsible for sharing commissions. - ✔✔C) the agent of the seller. The provision in a listing agreement that gives additional authority to the broker and obligates the broker to distribute the listing to other brokers is a(n) A) joint listing clause. B) multiple listing clause. C) net listing clause. D) open listing clause. - ✔✔B) multiple listing clause. A building sold for $157,000. The broker charged a 6 percent commission and divided it as follows: 10 percent to the salesperson who took the listing, one-half of the balance to the salesperson who made the sale, and the remainder to the broker. What was the listing salesperson's commission? A) $239 B) $942 C) $1,570 D) $4,239 - ✔✔B) $942 Last month broker Wanda took a listing on a property. She now learns that her client has been declared incompetent by the court. Her listing now is A) binding as the broker was acting in good faith. B) still valid. C) the basis for commission if the broker produces a buyer. D) terminated - ✔✔D) terminated The type of listing agreement that provides for payment of a commission to the broker even though the owner makes the sale without the broker's aid is called an A) exclusive-right-to-sell listing. B) open listing. C) exclusive-agency listing. D) option listing. - ✔✔A) exclusive-right-to-sell listing. Some property owners list their property for sale with a broker. During the listing negotiations, they tell the broker that they want $138,000 for the property, and anything above that amount the broker can keep as a commission. A listing with this type of provision is known as a A) gross listing. B) net listing. C) open listing. D) nonexclusive listing. - ✔✔B) net listing. Under which of the following listing agreements can owners of listed property sell the property on their own without having to pay the listing broker a commission? A) Exclusive-right-to-sell listing B) Exclusive-agency listing C) Open listing D) Both b and c - ✔✔D) Both b and c 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 because of the death of the principal. - ✔✔D) terminated automatically because of the death of the principal. A listing contract in which payment of the commission is contingent on the broker's being able to produce a buyer before the property is sold by the owner or another broker is called a(n) A) open listing. B) net listing. C) exclusive-right-to-sell listing. D) exclusive-agency listing. - ✔✔A) open listing. A broker who has done a proper CMA, discusses the probable market value of the property with the seller, and the seller wants an unrealistic price on the property all of the following are true EXCEPT A) Suggest the seller have a formal appraisal done. B) Take the listing with the understanding that price reductions may be needed. C) Must take the listing at the proposed seller's price D) May decline to take the listing at the high price. - ✔✔C) Must take the listing at the proposed seller's price All of the following are typically found in a listing agreement EXCEPT? A) The price the seller is asking for the property B) The date the broker will schedule an open house C) The commission rate to be paid to the listing broker D) The responsibilities of the broker - ✔✔B) The date the broker will schedule an open house The type of listing agreement that provides the least protection for the listing broker is the A) exclusive-right-to-sell listing. B) exclusive-agency listing. C) open listing. D) net listing. - ✔✔C) open listing. If a seller needs to net $50,000 after the sale, how much must the real estate sell for if the selling costs include a 7 percent commission and $1,200 in other expenses? A) $54,700 B) $54,963 C) $55,054 D) $55,633 - ✔✔C) $55,054 Under an exclusive buyer agency agreement the real estate broker would be entitled to a commission EXCEPT A) if the broker sells the buyer a listing from another firm. B) if the property is a FSBO. C) if the buyer finds a suitable property without the broker. D) if the buyer cancels the agreement of sale. - ✔✔C) if the buyer finds a suitable property without the broker. Under an exclusive-agency listing, the listing broker would be entitled to a commission EXCEPT if A) the broker sells the property herself. B) the property is sold through another broker. C) the property is sold through the multiple-listing service. D) the seller sells the property to a neighbor across the street who has her property listed with another broker. - ✔✔D) the seller sells the property to a neighbor across the street who has her property listed with another broker. All of the following are types of listing contracts EXCEPT? A) Open B) Exclusive-agency C) Exclusive-right-to-sell D) MLS - ✔✔D) MLS A buyer has signed an agreement with a broker to compensate the broker even if the buyer purchases the property from a relative. This is called a (n) A) open buyer agency agreement B) exclusive-agency buyer agency agreement C) exclusive buyer agency agreement D) invalid agreement - ✔✔C) exclusive buyer agency agreement The seller wants to net $65,000 on the sale of his house after paying the broker a fee of 6 percent. How much must the gross selling price be? A) $69,149 B) $68,093 C) $67,035 D) $66,091 - ✔✔A) $69,149 A broker enters into a listing agreement with a seller under which the seller will receive $22,000 from the sale of a lot and the broker will receive any sale proceeds over this amount. This type of listing is a(n) A) gross listing. B) legal and ethical way to ensure that the broker is compensated. C) exclusive agency. D) net listing. - ✔✔D) net listing. In some states the following type of listing is prohibited: A) Exclusive-right-to-sell B) Net listing C) Buyer agency agreement D) Open listing - ✔✔B) Net listing An owner who is interested in selling his house is usually concerned about how much money he can get when it sells. A competitive market analysis may help the seller determine a realistic listing price. Which of the following is true? A) A competitive market analysis is the same as an appraisal. B) A broker, but not a salesperson, is permitted to prepare a competitive market analysis. C) A competitive market analysis is what is prepared by a certified real estate appraiser. D) A competitive market analysis contains a compilation of facts about similar properties that have recently sold. - ✔✔D) A competitive market analysis contains a compilation of facts about similar properties that have recently sold. The salesperson received $2,800 commission on her 35 percent share of the total commission on the sale of a property that sold for $160,000. What was the commission rate? A) 10 percent B) 5 percent C) 7 percent D) 4.5 percent - ✔✔B) 5 percent A broker hires sales associates with an agreement to split company commissions thus: the broker—45 percent; the listing salesperson—30 percent; the selling salesperson—the rest. If the broker's share is $2,430, the property sold for $90,000, and the listing salesperson's share was $1,620, what was the selling sales associate's share? A) $2,700 B) $1,800 C) $1,350 D) $1,295 - ✔✔C) $1,350 All of the following are types of Buyer Agency Agreements EXCEPT A) an exclusive buyer agency agreement. B) an exclusive agency buyer agency agreement. C) an open buyer agency agreement. D) a net buyer agency agreement - ✔✔D) a net buyer agency agreement Before the Buyer signs a buyer agency agreement- a licensee must do all of the following EXCEPT A) explain forms of agency available. B) obtain financial information from the buyer. C) inform the buyer of the charges or compensation for services. D) describe specific services to be provided. - ✔✔B) obtain financial information from the buyer. A statutory right that a family has in its residence is called A) entirety. B) survivorship. C) curtesy. D) homestead. - ✔✔D) homestead. A person who has complete control of a parcel of real estate is said to own a A) leasehold estate. B) fee simple estate. C) life estate. D) defeasible fee estate. - ✔✔B) fee simple estate. A portion of Walter's building was inadvertently built on George's land. This caused an A) accretion. B) avulsion. C) encroachment. D) easement. - ✔✔C) encroachment. Many states determine the order of water rights according to which users of the water hold recorded beneficial use permits. This allocation of water rights is controlled by A) accretion. B) riparian theory. C) littoral theory. D) the doctrine of prior appropriation. - ✔✔D) the doctrine of prior appropriation. The purchase of a ticket for a professional sporting event gives the bearer A) an easement right to park his car. B) a license to enter and claim a seat for the duration of the game. C) an easement in gross interest in the professional sporting team. D) a license to sell goods and beverages at the sporting event. - ✔✔B) a license to enter and claim a seat for the duration of the game. Which of the following has an indeterminable duration? A) Freehold estate B) Less-than-freehold estate C) Estate for years D) License - ✔✔A) Freehold estate If the owner of the dominant tenement becomes the owner of the servient tenement and merges the two properties, A) the easement becomes dormant. B) the easement is unaffected. C) the easement is terminated. D) the properties retain their former status. - ✔✔C) the easement is terminated. A decedent left a will giving his neighbor the right to use a well on the decedent's land as long as the neighbor lived. The neighbor's interest in the property is properly called a(n) A) license. B) easement in gross. C) easement appurtenant. D) life estate. - ✔✔B) easement in gross. Homeowner Gurney acquired ownership of land that was deposited by a river running through his property by A) reliction. B) succession. C) avulsion. D) accretion. - ✔✔D) accretion. A life estate conveys to the life tenant A) a leasehold for life. B) a reversionary interest. C) a legal life estate. D) ownership for life. - ✔✔D) ownership for life. Janeen held fee simple title to a vacant lot adjacent to Mercy Hospital. She was persuaded to make the lot available to Mercy. She had her attorney prepare a deed that conveyed ownership of the lot to the hospital "...so long as it is used for medical purposes." After the completion of the gift, the hospital will own a A) life estate. B) tenancy for years. C) determinable fee estate. D) periodic tenancy. - ✔✔C) determinable fee estate. The type of real estate ownership that is most all-inclusive is a A) fee simple estate. B) life estate. C) conditional fee estate. D) reversionary interest. - ✔✔A) fee simple estate. The water rights of an owner of property located along [Show More]

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