In economics, the four factors of production are __________?

A. land, labor, capital, and improvements

B. land, labor, capital and entrepreneurship
C. land, labor, capital and money
D. land, improvements, labor and materials
E. land, labor, site, and improvements
ANSWER: B

The law of supply and demand is ________?

A. a basic economic principle
B. legislated by Congress
C. seldom used in the appraisal process
D. not a applicable in the short term
E. all of the above
ANSWER: A

Which of the is NOT an agent of production?

A. land
B. transportation
C. labor
D. capital
E. entrepreneurship
ANSWER: B

Political forces affecting value may include __________?

A. life-styles and living standards
B. topography
C. athletic levels and recreation facilities
D. government spending and taxation policy
E. primary registration and turnout
ANSWER: D

What are the two categories of tangible property?

A. real property and personal property
B. intangible property and real property
C. real estate and intangible property
D. legal and illegal investments
E. open and shut transactions
ANSWER: A

Zoning is an exercise of the __________?

A. equity courts
B. police powers
C. Environmental Protection Agency
D. Right of condemnation
E. Right of escheat
ANSWER: B

Which of the following types of property is subject to ad valorem taxation?

A. property owned by a religious organization and used for a religious purpose
B. new industrial plants that state and local governments have induced, with tax
exemption as an incentive, to locate within their jurisdictions
C. commercial buildings leased in part by nonprofit foundations
D. state colleges and universities
E. a state capitol
ANSWER: C

A person owning less than the entire bundle of rights has __________?
A. escheat
B. a fee simple title
C. a partial interest
D. personal property
E. a fee tail
ANSWER: C

A metes and bounds description begins and ends with the __________?
A. street and house number
B. block number
C. point of beginning
D. grid coordinates
E. iron pin
ANSWER: C

A (n) ____ identifies a property in such a way that it CANNOT be confused with any
other property.
A. coded map book
B. legal description
C. narrative appraisal
D. full city survey
E. engineering report
ANSWER: B

All of the following statements are true EXCEPT?

A. real property is a type of service
B. value is dependent on market conditions
C. a good or service has no value in exchange unless it possesses certain economic
and legal characteristics
D. the price representing value is usually quoted in terms of money
E. real estate may be sold for all cash or financing arranged
ANSWER: A

All of the following will affect the market value of a property EXCEPT?
A. political factors
B. legal use restriction
C. acquisition cost to present owner
D. economic factors
E. social concerns
ANSWER: C

Market value is ____ the same as selling price.

A. always
B. never
C. sometimes
D. usually
E. none of the above
ANSWER: C

Price is __________?
A. market value
B. most probable sales price
C. investment value
D. a historical fact
E. all of the above
ANSWER: D

Functional utility depends on __________?

A. zoning
B. wear and tear on the structure
C. tastes and standards
D. age of the equipment
E. insurance requirements
ANSWER: C

Value in use is __________?

A. subjective
B. objective
C. readily measurable
D. a market phenomenon
E. synonymous with market price
ANSWER: A

The value added to total property value by a particular component is an example of

the principle of __________?
A. substitution
B. anticipation
C. change
D. contribution
E. conformity
ANSWER: D

The concept that the value of a particular components is measure by the amount that
its absence would detract from the value of the whole is __________?
A. opportunity cost
B. substitution
C. competition
D. contribution
E. conformity
ANSWER: E

The market loss cause by depreciation in an older structure may be offset by all of
the following EXCEPT?
A. architectural interest
B. historical registration
C. strong demand relative to supply
D. strong supply relative to demand
E. renovation of the structure
ANSWER: D

Studying appraisal helps a person

A. to improve value estimation skills
B. to pass the real estate broker�s license examination
C. to understand other real estate courses
D. to communicate with appraisers
E. all of the above
ANSWER: E

A dramatic change in short-term demand for real estate in the local market is
likely to immediately precipitate.
A. construction
B. price changes
C. conversions
D. activity
E. no change in supply
ANSWER: B

The area and community analysis section of an appraisal report __________?

A. should �sell� the community
B. should describe the community objectively
C. is a study by the estate�s industrial development commission
D. considers the negative aspects only
E. considers the positive aspects only
ANSWER: B

In analyzing the economic environment and market area, it is best to __________?

A. start at the general level and work down to the specific
B. start at the specific and work up to the general level
C. limit the analysis to the national level
D. generally consider traffic flow
ANSWER: A

Which of the following reports is usually NOT prepared by a real estate appraiser?
A. marketability study
B. economic study
C. feasibility study
D. transportation network study
E. valuation study
ANSWER: D

An appraisal of a specific-purpose for insurance purpose would depend most heavily

on __________?
A. book value
B. cost estimate
C. land value
D. highest and best use
E. specialty value
ANSWER: B

The first step in the appraisal process is to __________?

A. define the problem to be solved
B. gather relevant data
C. analyze the data
D. inspect the property
E. set the fee to be charged
ANSWER: A

An appraisal is __________?
A. an estimate of net realizable value
B. always concerned with the market value
C. an appraiser�s opinion of market value
D. a precise statement of value
E. a broker�s comparative sales analysis with further detail
ANSWER: C

The �as of� date in an appraisal report is __________?

A. the date to which the value applies
B. immaterial to the value estimate
C. the date on which the report is delivered
D. the date on which the property will be conveyed
E. the anticipated closing date
ANSWER: A

Sales data descriptions of an appraisal report contain __________?

A. details about each comparable sale
B. an analysis of the date, using the value approaches
C. the investigation of market forces
D. analysis of the street each comparable property is on
E. zoning details
ANSWER: A

All of the following are ways to delineate a neighborhood EXCEPT?

A. natural barriers
B. utility service
C. political boundaries
D. streets
E. income characteristics
ANSWER: B

All of the following are sources of comparable sales EXCEPT?

A. public records
B. brokers
C. buyers and sellers
D. mortgage services
E. appraisers
ANSWER: D

Which of the following criteria most completely define �highest and best use�?
A. legally authorized, politically viable, and socially acceptable
B. physically possible, comparable to other uses in the neighborhood, and legally
authorized
C. physically possible, legally permissible, financially feasible, and generating a
higher present land value than any other use
D. comparable to other uses in the neighborhood, physically possible, and
generating a higher present land value than any other use
E. the tallest and most beautiful structure that can be placed on land
ANSWER: C

The three basic approaches used to estimate value are __________?

A. use, exclusion, and disposition
B. cost, sales comparison, and use
C. cost, sales comparison, and market data
D. cost, sales comparison, and production
E. cost, sales comparison, and income capitalization
ANSWER: E

Units of comparison are used in __________?

A. only the sales comparison approach
B. only the cost approach
C. only the income capitalization approach
D. A, B and C
E. the appraisal of special-purpose properties only
ANSWER: D

Final value estimates should be rounded to reflect the __________?

A. absence of good data
B. property�s location
C. fact that a selling price will probably be a round number
D. lack of precision associated with an opinion
E. high value of real estate
ANSWER: D