IAAO 112 || 100% Verified Answers.
appraisal process correct answers The is a systematic, logical method of collecting, analyzing,
and processing data into value estimates.
Definition of the problem correct answers is the first step in the appraisal process.
The ___________ of an appraisal is usually to estimate an opinion of a type of value, most often
__________ value. correct answers purpose, market
The type and extent of research and analyses in an appraisal or appraisal review assignment is
referred to as the _____________ correct answers scope of work.
In order to determine the appropriate scope of work an appraiser must properly ______________
to be solved. correct answers define (or identify) the problem
The four tests performed to determine the highest and best use of a property are: correct answers
physical possibility, legal permissibility, financial feasibility, and maximum productivity.
7. All three approaches to value, the Cost Approach, the Sales Comparison Approach, and the
Income Approach must be developed in every appraisal. True or False correct answers False
8. The worth of an investment property to a particular investor is:
a. Value in use
b. Value in exchange
c. Investment value
d. Market value correct answers c. Investment value
The results of deducting expected vacancy and collection losses from potential gross rent and
then adding miscellaneous income is:
a. Net operating income
b. Fair rental value
c. Expense ratio
d. Effective gross income correct answers d. Effective gross income
Which capitalization method or methods uses the IRV equations:
a. Direct capitalization
b. Yield capitalization
c. Both
d. Neither correct answers c. Both
Investment criteria includes all but:
a. Profit
b. Risk
c. Supplies
d. Illiquidity correct answers c. Supplies
, Investors are looking for a return ___ and a return ___ their capital. correct answers of and on
Which of the following is NOT a return on rate?
a. Interest rate
b. Discount rate
C. Yield rate
d. Recapture rate correct answers d. Recapture rate
The Principle of Anticipation states that value is the present worth of all the ________________
future benefits derived from a property. correct answers anticipated
A type of Mortgage usually depends on what five things? correct answers 1. Purpose of the loan
2. Reliability of the borrower
3. Terms required (time, interest rate, and repayment schedule)
4. Amount of the loan
5. Priority of mortgage if the property is already encumbered
Leverage is the borrowing of funds in anticipation of earning a ____________ return than the
cost of the borrowed funds. Investors in real estate often can borrow money at a lower rate than
the overall property yoeld on the real estate investment. correct answers greater
Leverage can be all but:
a. Positive
b. Prevailing
c. Negative
d. Neutral correct answers b. Prevailing
If the overall capitalization rate is 8%, the mortgage constant is 7% and the equity capitalization
rate is 11%, leverage is:
a. Positive
b. Negative
c. Neutral
d. Prevailing correct answers a. Positive
The nominal interest rate is the same as the effective interest rate only when there is
______________ compounding. correct answers annual
What is the Future Worth (or Value) of 1 factor (FW1) for five years at an interest rate of 10%
compounded annually? correct answers 1.610510
What is the present value of $5,000 that will be received in ten years assuming 6% interest
compounded annually on the money? correct answers $2,792 (rounded)
appraisal process correct answers The is a systematic, logical method of collecting, analyzing,
and processing data into value estimates.
Definition of the problem correct answers is the first step in the appraisal process.
The ___________ of an appraisal is usually to estimate an opinion of a type of value, most often
__________ value. correct answers purpose, market
The type and extent of research and analyses in an appraisal or appraisal review assignment is
referred to as the _____________ correct answers scope of work.
In order to determine the appropriate scope of work an appraiser must properly ______________
to be solved. correct answers define (or identify) the problem
The four tests performed to determine the highest and best use of a property are: correct answers
physical possibility, legal permissibility, financial feasibility, and maximum productivity.
7. All three approaches to value, the Cost Approach, the Sales Comparison Approach, and the
Income Approach must be developed in every appraisal. True or False correct answers False
8. The worth of an investment property to a particular investor is:
a. Value in use
b. Value in exchange
c. Investment value
d. Market value correct answers c. Investment value
The results of deducting expected vacancy and collection losses from potential gross rent and
then adding miscellaneous income is:
a. Net operating income
b. Fair rental value
c. Expense ratio
d. Effective gross income correct answers d. Effective gross income
Which capitalization method or methods uses the IRV equations:
a. Direct capitalization
b. Yield capitalization
c. Both
d. Neither correct answers c. Both
Investment criteria includes all but:
a. Profit
b. Risk
c. Supplies
d. Illiquidity correct answers c. Supplies
, Investors are looking for a return ___ and a return ___ their capital. correct answers of and on
Which of the following is NOT a return on rate?
a. Interest rate
b. Discount rate
C. Yield rate
d. Recapture rate correct answers d. Recapture rate
The Principle of Anticipation states that value is the present worth of all the ________________
future benefits derived from a property. correct answers anticipated
A type of Mortgage usually depends on what five things? correct answers 1. Purpose of the loan
2. Reliability of the borrower
3. Terms required (time, interest rate, and repayment schedule)
4. Amount of the loan
5. Priority of mortgage if the property is already encumbered
Leverage is the borrowing of funds in anticipation of earning a ____________ return than the
cost of the borrowed funds. Investors in real estate often can borrow money at a lower rate than
the overall property yoeld on the real estate investment. correct answers greater
Leverage can be all but:
a. Positive
b. Prevailing
c. Negative
d. Neutral correct answers b. Prevailing
If the overall capitalization rate is 8%, the mortgage constant is 7% and the equity capitalization
rate is 11%, leverage is:
a. Positive
b. Negative
c. Neutral
d. Prevailing correct answers a. Positive
The nominal interest rate is the same as the effective interest rate only when there is
______________ compounding. correct answers annual
What is the Future Worth (or Value) of 1 factor (FW1) for five years at an interest rate of 10%
compounded annually? correct answers 1.610510
What is the present value of $5,000 that will be received in ten years assuming 6% interest
compounded annually on the money? correct answers $2,792 (rounded)
