Real Estate CA State Exam - Questions With
Comprehensive Solutions
The court case of Easton vs. Strassburger expanded which real estate
procedures? Right Ans - In Easton vs. Strassburger, the seller and agent
were required to disclose all known material facts regarding the physical
condition of the property
The fiduciary relationship between an agent and the principal is comparable
to the relationship between: Right Ans - Between a trustee and beneficiary
in a trust deed
Joe owned a grocery store and wanted to raise some money. He decided to sell
his land and building to an investor and leased it back to himself in order to
continue running his grocery store there. What is now a tax benefit for Joe?
Right Ans - Joe's rent payments to the investor will be fully deductible for
income tax purposes as a business expense
A lender paid a 3% commission to an agent in a real estate transaction. This
must be revealed to: Right Ans - Both the buyer and the seller
What is an example of police power? Right Ans - Zoning laws which restrict
and limit the use of land
A contractor obtains a construction loan, and the loan funds are to be released
in a series of progress payments. Most lenders disburse the last payment
when the: Right Ans - Period to file a mechanic's lien has expired
When an owner acquired land which includes riparian rights, such riparian
rights: Right Ans - The owner of riparian rights has the right to reasonable
usage of the water - these rights may be determined accurately from an
examination of public records at the County Recorder's Office. Riparian rights
refer to moving water (brook, stream, river or watercourse)
The ultimate test of functional utility is: Right Ans - Marketability
Usually, the holder of a life estate based on the holder's own life may do the
following: Right Ans - - Lease the property to someone
Comprehensive Solutions
The court case of Easton vs. Strassburger expanded which real estate
procedures? Right Ans - In Easton vs. Strassburger, the seller and agent
were required to disclose all known material facts regarding the physical
condition of the property
The fiduciary relationship between an agent and the principal is comparable
to the relationship between: Right Ans - Between a trustee and beneficiary
in a trust deed
Joe owned a grocery store and wanted to raise some money. He decided to sell
his land and building to an investor and leased it back to himself in order to
continue running his grocery store there. What is now a tax benefit for Joe?
Right Ans - Joe's rent payments to the investor will be fully deductible for
income tax purposes as a business expense
A lender paid a 3% commission to an agent in a real estate transaction. This
must be revealed to: Right Ans - Both the buyer and the seller
What is an example of police power? Right Ans - Zoning laws which restrict
and limit the use of land
A contractor obtains a construction loan, and the loan funds are to be released
in a series of progress payments. Most lenders disburse the last payment
when the: Right Ans - Period to file a mechanic's lien has expired
When an owner acquired land which includes riparian rights, such riparian
rights: Right Ans - The owner of riparian rights has the right to reasonable
usage of the water - these rights may be determined accurately from an
examination of public records at the County Recorder's Office. Riparian rights
refer to moving water (brook, stream, river or watercourse)
The ultimate test of functional utility is: Right Ans - Marketability
Usually, the holder of a life estate based on the holder's own life may do the
following: Right Ans - - Lease the property to someone
