UPDATED LAW OF AGENCY EXAM 2
2024-2025 WITH VERIFIED SOLUTIONS
Customer - ANSWER>>>Javier represents Marcus, who's selling his rental property to Ben. Ben is
represented by another real estate licensee, Francis. What is Ben's relationship to Javier?
Client and fiduciary
Customer
Customer and client
Fiduciary
DRHP - ANSWER>>>Which acronym can help you to remember the duties a licensee owes to customers?
DRHP
OIL PAN
OLD CAR
PROP
License holder - ANSWER>>>Which term is defined as a broker or sales agent licensed under the Texas
Real Estate License Act?
Agent
Client/principal
License holder
REALTOR®
A (Jefferson insists that Ronna interpret the implications of him breaching his contract with a buyer) -
ANSWER>>>In which of these situations is Ronna's fiduciary duty of reasonable skill and care at odds
with her duty of obedience?
A. Jefferson insists that Ronna interpret the implications of him breaching his contract with a buyer.
B. Ronna's buyer client asked her to keep his financial situation confidential.
C. Ted, Ronna's broker, insisted that she teach a contracts class, even though she's a new agent.
D. Though her customer was adamant, Ronna turned down a commercial listing because it was outside
her area of expertise.
,Client - ANSWER>>>In Texas, a ________ is "someone who has agency representation with the real
estate sales agent or broker."
Client
Consumer
Customer
Fiduciary
An agent - ANSWER>>>"Someone who acts on behalf of someone else" is called _______.
A mortgage lender
An agent
An attorney
A trustor
OLD CAR - ANSWER>>>_______ is an acronym that can help you remember an agent's fiduciary duties.
CARE OF
DUE CARE
FAR GONE
OLD CAR
Client - ANSWER>>>A "principal" is also a/an _________.
Agent
Broker
Client
Fiduciary
C (The sellers are Peter's customers) - ANSWER>>>Simon is a buyer represented by Peter. Peter shows
Simon several homes currently on the market. What is Peter's relationship to the sellers, if he doesn't
represent them?
A. Peter has no relationship with the sellers.
B. Peter is a fiduciary for the sellers.
C. The sellers are Peter's customers.
D. The sellers are Peter's principals.
Implied agency - ANSWER>>>Christy found a property that was For Sale by Owner and made an offer.
The seller accepted Christy's offer, but neither of them knew how to proceed. Licensee Zelda helped
,Christy complete the necessary purchase documents and walked her through the process. What kind of
agency exists?
Confirmed agency
Express agency
Implied agency
Verbal agency
Loyalty - ANSWER>>>Putting clients' interests ahead of all others describes which fiduciary duty?
Confidentiality
Disclosure
Loyalty
Reasonable skill and care
C (Kelsey and Harold have a signed agency agreement) - ANSWER>>>Which of the following best
indicates that Harold is Kelsey's seller client?
A. At an open house, Harold asked Kelsey about her commission rate and sales track record.
B. Harold and Kelsey talked at a local elementary school event about the real estate market and the
possibility of Harold selling his house.
C. Kelsey and Harold have a signed agency agreement.
D. Kelsey cold-called Harold and he mentioned that he had indeed been thinking of selling his house.
A customer - ANSWER>>>Rhonda is an unrepresented buyer who's purchasing Tony's townhome. Gary
represents Tony in the sale of his property. What's Rhonda's relationship to Gary?
A client and fiduciary
A customer
A customer and client
A fiduciary
Residential rental locator - ANSWER>>>Which term is defined as a person who offers to locate a unit in
an apartment complex for lease to a prospective tenant for consideration?
Agent
Intermediary
Prospect
Residential rental locator
, A (Texas Real Estate Dealers Act) - ANSWER>>>What was the name of the first law regulating real estate
brokerage in Texas, which was originally passed in 1939?
A. Texas Real Estate Dealers Act
B. The Lone Star State Property Code
C. TREC's Rules and Regulations
D. TRELA
The first law established to regulate real estate brokerage in Texas was the Real Estate Dealers Act. TRELA
came along 16 years later.
A (Your duty of confidentiality to your client dictates that you not disclose your client's financial situation
to the seller.
Your duty of disclosure to customers and third parties requires that you disclose Crystal's financial status
to the seller) - ANSWER>>>You're representing Crystal in the purchase of a house. Crystal has a trust
fund and can more than afford the house on which she's made an offer. Which of the following
statements is true?
A. Your duty of confidentiality to your client dictates that you not disclose your client's financial situation
to the seller.
B. Your duty of disclosure to customers and third parties requires that you disclose Crystal's financial
status to the seller.
C. Your duty of honesty and fairness to customers dictates that you must share with the seller Crystal's
ability to pay more for the property than she offered.
D. Your duty of working in your client's best interests means you should be showing her properties that
are in a higher price range since she can afford it.
Intermediary - ANSWER>>>Which term is defined as a broker who is employed to negotiate a transaction
between the parties of a transaction, and for that purpose, may act as a limited agent of those parties?
Intermediary
Residential rental locator
Single agent
Sub-agent
Disclosure - ANSWER>>>Which fiduciary duty is missing: loyalty, reasonable skill and care, obedience,
confidentiality, accounting, and ______?
Disclosure
Disobedience
Lawfulness
2024-2025 WITH VERIFIED SOLUTIONS
Customer - ANSWER>>>Javier represents Marcus, who's selling his rental property to Ben. Ben is
represented by another real estate licensee, Francis. What is Ben's relationship to Javier?
Client and fiduciary
Customer
Customer and client
Fiduciary
DRHP - ANSWER>>>Which acronym can help you to remember the duties a licensee owes to customers?
DRHP
OIL PAN
OLD CAR
PROP
License holder - ANSWER>>>Which term is defined as a broker or sales agent licensed under the Texas
Real Estate License Act?
Agent
Client/principal
License holder
REALTOR®
A (Jefferson insists that Ronna interpret the implications of him breaching his contract with a buyer) -
ANSWER>>>In which of these situations is Ronna's fiduciary duty of reasonable skill and care at odds
with her duty of obedience?
A. Jefferson insists that Ronna interpret the implications of him breaching his contract with a buyer.
B. Ronna's buyer client asked her to keep his financial situation confidential.
C. Ted, Ronna's broker, insisted that she teach a contracts class, even though she's a new agent.
D. Though her customer was adamant, Ronna turned down a commercial listing because it was outside
her area of expertise.
,Client - ANSWER>>>In Texas, a ________ is "someone who has agency representation with the real
estate sales agent or broker."
Client
Consumer
Customer
Fiduciary
An agent - ANSWER>>>"Someone who acts on behalf of someone else" is called _______.
A mortgage lender
An agent
An attorney
A trustor
OLD CAR - ANSWER>>>_______ is an acronym that can help you remember an agent's fiduciary duties.
CARE OF
DUE CARE
FAR GONE
OLD CAR
Client - ANSWER>>>A "principal" is also a/an _________.
Agent
Broker
Client
Fiduciary
C (The sellers are Peter's customers) - ANSWER>>>Simon is a buyer represented by Peter. Peter shows
Simon several homes currently on the market. What is Peter's relationship to the sellers, if he doesn't
represent them?
A. Peter has no relationship with the sellers.
B. Peter is a fiduciary for the sellers.
C. The sellers are Peter's customers.
D. The sellers are Peter's principals.
Implied agency - ANSWER>>>Christy found a property that was For Sale by Owner and made an offer.
The seller accepted Christy's offer, but neither of them knew how to proceed. Licensee Zelda helped
,Christy complete the necessary purchase documents and walked her through the process. What kind of
agency exists?
Confirmed agency
Express agency
Implied agency
Verbal agency
Loyalty - ANSWER>>>Putting clients' interests ahead of all others describes which fiduciary duty?
Confidentiality
Disclosure
Loyalty
Reasonable skill and care
C (Kelsey and Harold have a signed agency agreement) - ANSWER>>>Which of the following best
indicates that Harold is Kelsey's seller client?
A. At an open house, Harold asked Kelsey about her commission rate and sales track record.
B. Harold and Kelsey talked at a local elementary school event about the real estate market and the
possibility of Harold selling his house.
C. Kelsey and Harold have a signed agency agreement.
D. Kelsey cold-called Harold and he mentioned that he had indeed been thinking of selling his house.
A customer - ANSWER>>>Rhonda is an unrepresented buyer who's purchasing Tony's townhome. Gary
represents Tony in the sale of his property. What's Rhonda's relationship to Gary?
A client and fiduciary
A customer
A customer and client
A fiduciary
Residential rental locator - ANSWER>>>Which term is defined as a person who offers to locate a unit in
an apartment complex for lease to a prospective tenant for consideration?
Agent
Intermediary
Prospect
Residential rental locator
, A (Texas Real Estate Dealers Act) - ANSWER>>>What was the name of the first law regulating real estate
brokerage in Texas, which was originally passed in 1939?
A. Texas Real Estate Dealers Act
B. The Lone Star State Property Code
C. TREC's Rules and Regulations
D. TRELA
The first law established to regulate real estate brokerage in Texas was the Real Estate Dealers Act. TRELA
came along 16 years later.
A (Your duty of confidentiality to your client dictates that you not disclose your client's financial situation
to the seller.
Your duty of disclosure to customers and third parties requires that you disclose Crystal's financial status
to the seller) - ANSWER>>>You're representing Crystal in the purchase of a house. Crystal has a trust
fund and can more than afford the house on which she's made an offer. Which of the following
statements is true?
A. Your duty of confidentiality to your client dictates that you not disclose your client's financial situation
to the seller.
B. Your duty of disclosure to customers and third parties requires that you disclose Crystal's financial
status to the seller.
C. Your duty of honesty and fairness to customers dictates that you must share with the seller Crystal's
ability to pay more for the property than she offered.
D. Your duty of working in your client's best interests means you should be showing her properties that
are in a higher price range since she can afford it.
Intermediary - ANSWER>>>Which term is defined as a broker who is employed to negotiate a transaction
between the parties of a transaction, and for that purpose, may act as a limited agent of those parties?
Intermediary
Residential rental locator
Single agent
Sub-agent
Disclosure - ANSWER>>>Which fiduciary duty is missing: loyalty, reasonable skill and care, obedience,
confidentiality, accounting, and ______?
Disclosure
Disobedience
Lawfulness
