Real Estate Valuation and Appraisal
Practice Exam-Graded A
A property at its highest and best use will: - ANSWER-Produce the greatest net income
over a period of time
A well done appraisal, including consideration of all available data, and completed by an
appraiser of much experience and good judgment, is best defined as: - ANSWER-An
opinion
As a concept of value, the highest and best use is the use that: - ANSWER-Produces
the greatest net return on the investment
As you are holding forth as an expert in property value matters, the tenant asks you to
compute the proper total rent per month for the coming year based upon the present
cost of living index of 125.8. You respond that the proper rent should be __________ . -
ANSWER-$409.77
(125..8 = 1.02442, $400 X 1.02442 = $409.768)
What is effective age? - ANSWER-None of the above
Deferred maintenance is the: - ANSWER-Part of physical deterioration which can be
restored by repairs and maintenance
When a property has suffered reduction in value due to dry rot and termite damage,
appraisers will refer to such a reduction as: - ANSWER-Physical deterioration
The period of time through which a property gives benefits to its owners is best
described as: - ANSWER-Economic life
Physical deterioration most closely means: - ANSWER-Wear and tear
Economic life is: - ANSWER-Normally shorter than physical life
A house and a lot were valued at $50,000; $40,000 for the building, $10,000 for the
land. If the economic life of the building was 40 years,what was the value of the property
after 14 years? - ANSWER-$36,000
Compared to physical life, economic life is usually: - ANSWER-Shorter
, When a lump sum expenditure is required for overdue repairs, it is usually identified as:
- ANSWER-Deferred maintenance
Loss of value due to deferred maintenance is called: - ANSWER-Physical depreciation
What type of reduction in value is present when a hydrogen gas storage tank is located
next to a property? - ANSWER-Economic obsolescence
Which of the following types of depreciation may be curable? - ANSWER-Physical and
functional obsolescence
Which of the following might be classified as functional obsolescence? - ANSWER-A
property that has a single car garage
Which of the following represents obsolescence? - ANSWER-Loss in value due to
neighborhood changes
Which is the generally preferred appraisal approach for the valuation of land? -
ANSWER-The Market Data Approach
The main valuation principle in the market data approach is: - ANSWER-Substitution
In making an appraisal by the Market Data Approach, an appraiser would give greater
weight to: - ANSWER-A similar home with equal amenities which was sold under
market conditions six months ago
The market data appraisal approach would be best used for which of the following types
of property? - ANSWER-Vacant land
In valuing a house by the Market Data Approach, adjustments are made to the: -
ANSWER-Comparable property
In reconciling the data in the market data approach, the appraiser generally gives the
greatest consideration to: - ANSWER-The comparable's sales that have occurred most
recently and have the greatest degree of comparability
An appraiser seeking to find market value would be least concerned with: - ANSWER-
The original cost of material
The use of comparable property to estimate market value best defines: - ANSWER-The
Market Data method
Of the following, the dollar valuation which normally is the highest is: - ANSWER-Market
value
Practice Exam-Graded A
A property at its highest and best use will: - ANSWER-Produce the greatest net income
over a period of time
A well done appraisal, including consideration of all available data, and completed by an
appraiser of much experience and good judgment, is best defined as: - ANSWER-An
opinion
As a concept of value, the highest and best use is the use that: - ANSWER-Produces
the greatest net return on the investment
As you are holding forth as an expert in property value matters, the tenant asks you to
compute the proper total rent per month for the coming year based upon the present
cost of living index of 125.8. You respond that the proper rent should be __________ . -
ANSWER-$409.77
(125..8 = 1.02442, $400 X 1.02442 = $409.768)
What is effective age? - ANSWER-None of the above
Deferred maintenance is the: - ANSWER-Part of physical deterioration which can be
restored by repairs and maintenance
When a property has suffered reduction in value due to dry rot and termite damage,
appraisers will refer to such a reduction as: - ANSWER-Physical deterioration
The period of time through which a property gives benefits to its owners is best
described as: - ANSWER-Economic life
Physical deterioration most closely means: - ANSWER-Wear and tear
Economic life is: - ANSWER-Normally shorter than physical life
A house and a lot were valued at $50,000; $40,000 for the building, $10,000 for the
land. If the economic life of the building was 40 years,what was the value of the property
after 14 years? - ANSWER-$36,000
Compared to physical life, economic life is usually: - ANSWER-Shorter
, When a lump sum expenditure is required for overdue repairs, it is usually identified as:
- ANSWER-Deferred maintenance
Loss of value due to deferred maintenance is called: - ANSWER-Physical depreciation
What type of reduction in value is present when a hydrogen gas storage tank is located
next to a property? - ANSWER-Economic obsolescence
Which of the following types of depreciation may be curable? - ANSWER-Physical and
functional obsolescence
Which of the following might be classified as functional obsolescence? - ANSWER-A
property that has a single car garage
Which of the following represents obsolescence? - ANSWER-Loss in value due to
neighborhood changes
Which is the generally preferred appraisal approach for the valuation of land? -
ANSWER-The Market Data Approach
The main valuation principle in the market data approach is: - ANSWER-Substitution
In making an appraisal by the Market Data Approach, an appraiser would give greater
weight to: - ANSWER-A similar home with equal amenities which was sold under
market conditions six months ago
The market data appraisal approach would be best used for which of the following types
of property? - ANSWER-Vacant land
In valuing a house by the Market Data Approach, adjustments are made to the: -
ANSWER-Comparable property
In reconciling the data in the market data approach, the appraiser generally gives the
greatest consideration to: - ANSWER-The comparable's sales that have occurred most
recently and have the greatest degree of comparability
An appraiser seeking to find market value would be least concerned with: - ANSWER-
The original cost of material
The use of comparable property to estimate market value best defines: - ANSWER-The
Market Data method
Of the following, the dollar valuation which normally is the highest is: - ANSWER-Market
value
