ROCKWELL FUNDAMENTAL COMPREHENSIVE EXAM
UPDATED QUESTIONS AND ANSWERS RATED A+
✔✔A buyer is unfamiliar with the concept of discount points and asks a licensee to
explain. The licensee responds, "Discount points are used to replace funds that are
being held by the Federal Reserve, so that more funds are available to lend." Is this
description correct?
a. no, discount pints are used to increase the yield for lenders who will sell the loans on
the secondary market.
b. no, discount points are used to pay brokers' commissions
c. yes, banks hold discount points in escrow until sufficient funds have been
accumulated to make more loans
d. yes, discount points lower interest rates, making loans more affordable for everyone -
✔✔A. no, discount points are used to increase the yield for lenders who will sell the
loans on the secondary market
✔✔A percolation test will examine the:
a. likelihood of landslides our subsidence
b. presence of toxic contamination in soil
c. roofing materials ability to repel rain
d. soil's ability to absorb and retain water - ✔✔D. soil's ability to absorb and retain water
✔✔A $4,500 earnest money check bounces because of insufficient funds. The first thing
the broker should do is:
a. notify escrow to charge this amount, plus the bounced check fee, to the buyer
b. notify the borrower
c. notify the principals
d. write a personal check for $4,500 to cover the shortage - ✔✔C. notify the principals
✔✔A seller tells a real estate agent that she has lived in the neighborhood for a long
time and would to be selective about who buys her house; she would like the agent to
tell her the race and nationality of all prospective buyers. How should the agent
respond?
a. agree to it, but avoid using any discriminatory advertising
b. agree to it, as the agent owes the seller the duty of loyalty
c. end her agency with the seller, as the agents duty is to find the most lucrative offer for
the seller regardless of race
d. end her agency with the seller, as it would be a violation of the federal Fair Housing
Act - ✔✔D. end her agency with the seller, as it would be a violation of the federal Fair
Housing Act
✔✔A property manager bases the operating budget on:
a. rental rates
b. the rental market
c. anticipated expenses and revenue
,d. state landlord-tenant law - ✔✔C. anticipated expenses and revenue
✔✔A parcel measures 198 feet by 330 feet. It sold for $30,000. What was the price per
acre?
a. $294
b. $20,000
c. $45,000
d. $2,500,000 - ✔✔B. $20,000
(198 x 330 = 65,340)
(65,,560 = 1.5 acres)
(30,.5 = $20,000)
✔✔Meridians and base lines relate to the:
a. lot and block method
b. metes and bounds method
c. recorded map method
d. rectangular survey method - ✔✔D. rectangular survey method
(aka the government survey system. land is divided into series of grids and each grid is
identified by the principal meridian and base line)
✔✔Which of the following would characterize a tenancy in common?
a. only available to married persons
b. requirement of equal interests
c. right of survivorship
d. tenants can will a partial interest in the property - ✔✔D. tenants can will a partial
interest in the property
✔✔A buyer accepts a warranty deed from a seller, believing that the seller is the sole
owner of the property. The buyer later finds out that the seller is only a co-owner. Has a
covenant in the warranty deed been violated?
a. no, the only covenant in a general warranty deed promises that the previous owner
didn't encumber the property
b. no, the principal of caveat emptor controls matters concerning a deed
c. yes, there is a covenant providing equitable title
d. yes, there is a covenant providing marketable title - ✔✔D. yes, there is a covenant
providing marketable title
✔✔K buys a piece of landlocked property from L on the condition that L provide an
easement across the property for ingress and egress. The easement isn't recorded, K
later sells the property. Is the easement still valid for the new owner?
a. no, because it wasn't recorded
b. no, because it wasn't mentioned in the deed
, c. yes, because an easement of this type runs with the land, rather than belonging to an
individual
d. yes, because K is the servient tenant and L is the dominant tenant - ✔✔C. yes,
because the easement of this type runs with the land, rather than belonging to an
individual
✔✔A licensee is helping her buyer purchase some property. The buyer would like to
make an offer on a corner lot that may have once been used as a storage site for a
heating oil company. The licensee should advise her buyer to:
a. consult with an environmental expert
b. request a spot zone
c. seek tentative approval from the Environmental Protection Agency
d. use a condemnation clause in the offer - ✔✔A. consult with an environmental expert
✔✔When can a minor enter into a binding contract?
a. if a guardian co-signs
b. if the contract is witnessed
c. if the minor is at least 16 years of age
d. never - ✔✔A. if a guardian co-signs
✔✔Late on a Friday afternoon, an agent receives an offer on a property that she has
listed, for $10,000 less than the listed price. The sellers will be away all weekend. The
agent should:
a. discard the offer since it is not for the desired amount
b. try to get the offer to them as soon as possible on Friday
c. wait in the hope that a full-price offer comes in
d. have an unlicensed assistant present the offer - ✔✔B. try to get the offer to them as
soon as possible on Friday
✔✔Gail gives ABC Realty a listing that stipulates it is the only real estate firm authorized
to list her home. At the same time she insists on including a provision that would allow
her to sell the home herself without paying a commission to ABC. Which of the following
describes the kind of listing she has created?
a. non-excluding listing
b. exclusive right to sell listing
c. exclusive open listing
d. exclusive agency listing - ✔✔D. exclusive agency listing
(exclusive agency listing entitles brokerage to a commission if anyone other than the
seller finds a buyer for the property during the listing's term)
✔✔A buyer makes an offer to purchase on May 2. The offer includes a promise to
deposit $5,000 in earnest money within two business days after mutual acceptance.
The offer is contingent on results of a soil feasibility report. On May 5 the seller accepts
the offer. On May 11 the soil report is ordered. On May 17 the soil feasibility report
UPDATED QUESTIONS AND ANSWERS RATED A+
✔✔A buyer is unfamiliar with the concept of discount points and asks a licensee to
explain. The licensee responds, "Discount points are used to replace funds that are
being held by the Federal Reserve, so that more funds are available to lend." Is this
description correct?
a. no, discount pints are used to increase the yield for lenders who will sell the loans on
the secondary market.
b. no, discount points are used to pay brokers' commissions
c. yes, banks hold discount points in escrow until sufficient funds have been
accumulated to make more loans
d. yes, discount points lower interest rates, making loans more affordable for everyone -
✔✔A. no, discount points are used to increase the yield for lenders who will sell the
loans on the secondary market
✔✔A percolation test will examine the:
a. likelihood of landslides our subsidence
b. presence of toxic contamination in soil
c. roofing materials ability to repel rain
d. soil's ability to absorb and retain water - ✔✔D. soil's ability to absorb and retain water
✔✔A $4,500 earnest money check bounces because of insufficient funds. The first thing
the broker should do is:
a. notify escrow to charge this amount, plus the bounced check fee, to the buyer
b. notify the borrower
c. notify the principals
d. write a personal check for $4,500 to cover the shortage - ✔✔C. notify the principals
✔✔A seller tells a real estate agent that she has lived in the neighborhood for a long
time and would to be selective about who buys her house; she would like the agent to
tell her the race and nationality of all prospective buyers. How should the agent
respond?
a. agree to it, but avoid using any discriminatory advertising
b. agree to it, as the agent owes the seller the duty of loyalty
c. end her agency with the seller, as the agents duty is to find the most lucrative offer for
the seller regardless of race
d. end her agency with the seller, as it would be a violation of the federal Fair Housing
Act - ✔✔D. end her agency with the seller, as it would be a violation of the federal Fair
Housing Act
✔✔A property manager bases the operating budget on:
a. rental rates
b. the rental market
c. anticipated expenses and revenue
,d. state landlord-tenant law - ✔✔C. anticipated expenses and revenue
✔✔A parcel measures 198 feet by 330 feet. It sold for $30,000. What was the price per
acre?
a. $294
b. $20,000
c. $45,000
d. $2,500,000 - ✔✔B. $20,000
(198 x 330 = 65,340)
(65,,560 = 1.5 acres)
(30,.5 = $20,000)
✔✔Meridians and base lines relate to the:
a. lot and block method
b. metes and bounds method
c. recorded map method
d. rectangular survey method - ✔✔D. rectangular survey method
(aka the government survey system. land is divided into series of grids and each grid is
identified by the principal meridian and base line)
✔✔Which of the following would characterize a tenancy in common?
a. only available to married persons
b. requirement of equal interests
c. right of survivorship
d. tenants can will a partial interest in the property - ✔✔D. tenants can will a partial
interest in the property
✔✔A buyer accepts a warranty deed from a seller, believing that the seller is the sole
owner of the property. The buyer later finds out that the seller is only a co-owner. Has a
covenant in the warranty deed been violated?
a. no, the only covenant in a general warranty deed promises that the previous owner
didn't encumber the property
b. no, the principal of caveat emptor controls matters concerning a deed
c. yes, there is a covenant providing equitable title
d. yes, there is a covenant providing marketable title - ✔✔D. yes, there is a covenant
providing marketable title
✔✔K buys a piece of landlocked property from L on the condition that L provide an
easement across the property for ingress and egress. The easement isn't recorded, K
later sells the property. Is the easement still valid for the new owner?
a. no, because it wasn't recorded
b. no, because it wasn't mentioned in the deed
, c. yes, because an easement of this type runs with the land, rather than belonging to an
individual
d. yes, because K is the servient tenant and L is the dominant tenant - ✔✔C. yes,
because the easement of this type runs with the land, rather than belonging to an
individual
✔✔A licensee is helping her buyer purchase some property. The buyer would like to
make an offer on a corner lot that may have once been used as a storage site for a
heating oil company. The licensee should advise her buyer to:
a. consult with an environmental expert
b. request a spot zone
c. seek tentative approval from the Environmental Protection Agency
d. use a condemnation clause in the offer - ✔✔A. consult with an environmental expert
✔✔When can a minor enter into a binding contract?
a. if a guardian co-signs
b. if the contract is witnessed
c. if the minor is at least 16 years of age
d. never - ✔✔A. if a guardian co-signs
✔✔Late on a Friday afternoon, an agent receives an offer on a property that she has
listed, for $10,000 less than the listed price. The sellers will be away all weekend. The
agent should:
a. discard the offer since it is not for the desired amount
b. try to get the offer to them as soon as possible on Friday
c. wait in the hope that a full-price offer comes in
d. have an unlicensed assistant present the offer - ✔✔B. try to get the offer to them as
soon as possible on Friday
✔✔Gail gives ABC Realty a listing that stipulates it is the only real estate firm authorized
to list her home. At the same time she insists on including a provision that would allow
her to sell the home herself without paying a commission to ABC. Which of the following
describes the kind of listing she has created?
a. non-excluding listing
b. exclusive right to sell listing
c. exclusive open listing
d. exclusive agency listing - ✔✔D. exclusive agency listing
(exclusive agency listing entitles brokerage to a commission if anyone other than the
seller finds a buyer for the property during the listing's term)
✔✔A buyer makes an offer to purchase on May 2. The offer includes a promise to
deposit $5,000 in earnest money within two business days after mutual acceptance.
The offer is contingent on results of a soil feasibility report. On May 5 the seller accepts
the offer. On May 11 the soil report is ordered. On May 17 the soil feasibility report
