Question 1

The most commonly used methods of real estate appraisal are

Accepted Answer

A)  market approach, income, and cost. 
B)  income, reproduction, and cost. 
C)  residual, cost, and market data. 
D)  comparison, income, and capitalization. 
A)  market approach, income, and cost. 
B)  income, reproduction, and cost. 
C)  residual, cost, and market data. 
D)  comparison, income, and capitalization.

Question 2

A gross rent multiplier is most used by owners in self-evaluating owner-occupied dwellings.

Accepted Answer

A) True 
 B)False

Question 3

A market where there is an excess of supply over demand is known as a ____________________ market.

Accepted Answer

The answer of A market where there is an excess...

Question 4

In the market approach, houses with similar physical features and amenities that have sold recently under market value conditions are called ____________________.

Accepted Answer

The answer of In the market approach, houses with similar...

Question 5

Seller motivation is considered most in the income approach.

Accepted Answer

A) True 
 B)False

Question 6

The rents that a property can be expected to produce on an annual basis may be referred to as the projected gross income.

Accepted Answer

A) True 
 B)False

Question 7

Choose the one most appropriate answer for each.
-the estimated rent a fully occupied property can be expected to produce on an annual basis

Accepted Answer

A) adjustments 
B) appraisal 
C) buyer's market 
D) capitalize 
E) comparables
F)cost approach
G)curable depreciation
H)depreciation
I)functional obsolescence
J)gross rent multiplier (GRM)
K)highest and best use
L)income approach
M)incurable depreciation
N)market approach
O)net operating income (NOI)
P)operating expenses
Q)physical deterioration
R)reproduction cost
S)scheduled gross income
T)subject property 
A) adjustments 
B) appraisal 
C) buyer's market 
D) capitalize 
E) comparables
F)cost approach
G)curable depreciation
H)depreciation
I)functional obsolescence
J)gross rent multiplier (GRM)
K)highest and best use
L)income approach
M)incurable depreciation
N)market approach
O)net operating income (NOI)
P)operating expenses
Q)physical deterioration
R)reproduction cost
S)scheduled gross income
T)subject property

Question 8

When real property loses value due to social or economic changes, this loss is called

Accepted Answer

A)  obsolescence. 
B)  depreciation. 
C)  chattel loss. 
D)  recapture. 
A)  obsolescence. 
B)  depreciation. 
C)  chattel loss. 
D)  recapture.

Question 9

The appraisal method most likely to provide only a rough estimate of the value of a rental property is the cost approach.

Accepted Answer

A) True 
 B)False

Question 10

Choose the one most appropriate answer for each.
-the property that is being appraised

Accepted Answer

A) adjustments 
B) appraisal 
C) buyer's market 
D) capitalize 
E) comparables
F)cost approach
G)curable depreciation
H)depreciation
I)functional obsolescence
J)gross rent multiplier (GRM)
K)highest and best use
L)income approach
M)incurable depreciation
N)market approach
O)net operating income (NOI)
P)operating expenses
Q)physical deterioration
R)reproduction cost
S)scheduled gross income
T)subject property 
A) adjustments 
B) appraisal 
C) buyer's market 
D) capitalize 
E) comparables
F)cost approach
G)curable depreciation
H)depreciation
I)functional obsolescence
J)gross rent multiplier (GRM)
K)highest and best use
L)income approach
M)incurable depreciation
N)market approach
O)net operating income (NOI)
P)operating expenses
Q)physical deterioration
R)reproduction cost
S)scheduled gross income
T)subject property

Question 11

The definition of fair market value requires, among other things, that the

Accepted Answer

A)  property is exposed to the open market for a reasonable time. 
B)  seller can convey a fee simple title. 
C)  buyer is qualified for reasonable financing. 
D)  sale was free of high-pressure listing and sales agents. 
A)  property is exposed to the open market for a reasonable time. 
B)  seller can convey a fee simple title. 
C)  buyer is qualified for reasonable financing. 
D)  sale was free of high-pressure listing and sales agents.

Question 12

Choose the one most appropriate answer for each.
-depreciation that can be remedied at a reasonable cost

Accepted Answer

A) adjustments 
B) appraisal 
C) buyer's market 
D) capitalize 
E) comparables
F)cost approach
G)curable depreciation
H)depreciation
I)functional obsolescence
J)gross rent multiplier (GRM)
K)highest and best use
L)income approach
M)incurable depreciation
N)market approach
O)net operating income (NOI)
P)operating expenses
Q)physical deterioration
R)reproduction cost
S)scheduled gross income
T)subject property 
A) adjustments 
B) appraisal 
C) buyer's market 
D) capitalize 
E) comparables
F)cost approach
G)curable depreciation
H)depreciation
I)functional obsolescence
J)gross rent multiplier (GRM)
K)highest and best use
L)income approach
M)incurable depreciation
N)market approach
O)net operating income (NOI)
P)operating expenses
Q)physical deterioration
R)reproduction cost
S)scheduled gross income
T)subject property

Question 13

Choose the one most appropriate answer for each.
-depreciation resulting from improvements that are inadequate, overly adequate, or improperly designed for today's needs

Accepted Answer

A) adjustments 
B) appraisal 
C) buyer's market 
D) capitalize 
E) comparables
F)cost approach
G)curable depreciation
H)depreciation
I)functional obsolescence
J)gross rent multiplier (GRM)
K)highest and best use
L)income approach
M)incurable depreciation
N)market approach
O)net operating income (NOI)
P)operating expenses
Q)physical deterioration
R)reproduction cost
S)scheduled gross income
T)subject property 
A) adjustments 
B) appraisal 
C) buyer's market 
D) capitalize 
E) comparables
F)cost approach
G)curable depreciation
H)depreciation
I)functional obsolescence
J)gross rent multiplier (GRM)
K)highest and best use
L)income approach
M)incurable depreciation
N)market approach
O)net operating income (NOI)
P)operating expenses
Q)physical deterioration
R)reproduction cost
S)scheduled gross income
T)subject property

Question 14

Which of the following operating expense ratios indicate one dollar of total operating expenses for every two dollars of effective gross income?

Accepted Answer

A)  33.3% 
B)  50% 
C)  200% 
D)  25% 
A)  33.3% 
B)  50% 
C)  200% 
D)  25%

Question 15

The phrase "more houses are torn down than fall down" is referring to the basic theory of obsolescence.

Accepted Answer

A) True 
 B)False

Question 16

Choose the one most appropriate answer for each.
-depreciation that cannot be remedied at a reasonable cost

Accepted Answer

A) adjustments 
B) appraisal 
C) buyer's market 
D) capitalize 
E) comparables
F)cost approach
G)curable depreciation
H)depreciation
I)functional obsolescence
J)gross rent multiplier (GRM)
K)highest and best use
L)income approach
M)incurable depreciation
N)market approach
O)net operating income (NOI)
P)operating expenses
Q)physical deterioration
R)reproduction cost
S)scheduled gross income
T)subject property 
A) adjustments 
B) appraisal 
C) buyer's market 
D) capitalize 
E) comparables
F)cost approach
G)curable depreciation
H)depreciation
I)functional obsolescence
J)gross rent multiplier (GRM)
K)highest and best use
L)income approach
M)incurable depreciation
N)market approach
O)net operating income (NOI)
P)operating expenses
Q)physical deterioration
R)reproduction cost
S)scheduled gross income
T)subject property

Question 17

Choose the one most appropriate answer for each.
-cost at today's prices of constructing an exact replica of the subject improvements using the same or similar methods

Accepted Answer

A) adjustments 
B) appraisal 
C) buyer's market 
D) capitalize 
E) comparables
F)cost approach
G)curable depreciation
H)depreciation
I)functional obsolescence
J)gross rent multiplier (GRM)
K)highest and best use
L)income approach
M)incurable depreciation
N)market approach
O)net operating income (NOI)
P)operating expenses
Q)physical deterioration
R)reproduction cost
S)scheduled gross income
T)subject property 
A) adjustments 
B) appraisal 
C) buyer's market 
D) capitalize 
E) comparables
F)cost approach
G)curable depreciation
H)depreciation
I)functional obsolescence
J)gross rent multiplier (GRM)
K)highest and best use
L)income approach
M)incurable depreciation
N)market approach
O)net operating income (NOI)
P)operating expenses
Q)physical deterioration
R)reproduction cost
S)scheduled gross income
T)subject property

Question 18

Which of the following in an old commercial building would most likely be a cause of incurable obsolescence?

Accepted Answer

A)  Lack of computer wiring 
B)  Widely spaced support walls 
C)  Lack of intercom system 
D)  Unattractive décor 
A)  Lack of computer wiring 
B)  Widely spaced support walls 
C)  Lack of intercom system 
D)  Unattractive décor

Question 19

Depreciation resulting from the closing of a large business in a small town is classed as

Accepted Answer

A)  functional obsolescence. 
B)  physical deterioration. 
C)  economic obsolescence. 
D)  political obsolescence.. 
A)  functional obsolescence. 
B)  physical deterioration. 
C)  economic obsolescence. 
D)  political obsolescence..

Question 20

The Society of Real Estate Appraisers offers the CREI designation.

Accepted Answer

A) True 
 B)False

Exam 17: Real Estate Appraisal

The most commonly used methods of real estate appraisal are

A gross rent multiplier is most used by owners in self-evaluating owner-occupied dwellings.

A market where there is an excess of supply over demand is known as a ____________________ market.

In the market approach, houses with similar physical features and amenities that have sold recently under market value conditions are called ____________________.

Seller motivation is considered most in the income approach.

The rents that a property can be expected to produce on an annual basis may be referred to as the projected gross income.

Choose the one most appropriate answer for each. -the estimated rent a fully occupied property can be expected to produce on an annual basis

When real property loses value due to social or economic changes, this loss is called

The appraisal method most likely to provide only a rough estimate of the value of a rental property is the cost approach.

Choose the one most appropriate answer for each. -the property that is being appraised

The definition of fair market value requires, among other things, that the

Choose the one most appropriate answer for each. -depreciation that can be remedied at a reasonable cost

Choose the one most appropriate answer for each. -depreciation resulting from improvements that are inadequate, overly adequate, or improperly designed for today's needs

Which of the following operating expense ratios indicate one dollar of total operating expenses for every two dollars of effective gross income?

The phrase "more houses are torn down than fall down" is referring to the basic theory of obsolescence.

Choose the one most appropriate answer for each. -depreciation that cannot be remedied at a reasonable cost

Choose the one most appropriate answer for each. -cost at today's prices of constructing an exact replica of the subject improvements using the same or similar methods

Which of the following in an old commercial building would most likely be a cause of incurable obsolescence?

Depreciation resulting from the closing of a large business in a small town is classed as

The Society of Real Estate Appraisers offers the CREI designation.

Nature and Description of Real Estate

Rights and Interests in Land

Forms of Ownership

Transferring Title

Recordation Abstracts and Title Insurance

Contract Law

Real Estate Sales Contracts

Mortgage and Note

Deed of Trust

Lending Practices

The Loan and the Consumer

Sources of Financing

Types of Financing

Taxes and Assessments

Title Closing and Escrow

Real Estate Leases

Licensing Laws and Professional Affiliation

The Principal-Broker Relationship: Employment

The Principal-Broker Relationship: Agency

Fair Housing, Ada, Equal Credit, and Community Reinvestment

Condominiums, Cooperatives, Puds, and Timeshares

Property Insurance

Land-Use Control

Real Estate and the Economy

Investing in Real Estate

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