California Real Estate Broker Exam
Broker A receives two offers on Seller B's house, which is listed for sale at $250,000. The first
offer is for all cash at $200,000. The second offer is for 20% down with 80% financing for the
full price. What should the broker do with respect to both offers? -correct answer-Present
both offers to the seller as soon as possible.
The two primary documents dealing with payment of a loan are the mortgage or deed of
trust and a -correct answer-promissory note.
The term that best describes a continuous urban corridor joining at least two cities is -
correct answer-megalopolis.
The term real property can also be described as -correct answer-the bundle of rights.
The rights of a landowner to a river bordering her property are known as -correct answer-
riparian rights.
In the case of a transfer of ownership of a piece of real estate, a fixture is normally -correct
answer-assumed to be included in the transfer.
A tenant who operates a jewelry store wants to take his jewelry cases with him at the
expiration of the lease. What is the best solution? -correct answer-He may take the cases if
removal will not cause substantial damage.
A legal description of property is not adequate unless -correct answer-land boundaries are
defined.
The lot and block system of property description is not also known as the -correct answer-
rectangular survey system.
What best describes the interests of the holder of a life estate? -correct answer-possession,
use, and ownership
How many acres does a section of land contain? -correct answer-640 acres
The requirement that multiple owners take title to property at the same time is a
characteristic of -correct answer-joint tenancy.
The type of ownership that provides the most complete bundle of rights is -correct answer-
fee simple absolute.
Which are most similar to each other with respect to inheriting property? -correct answer-
joint tenancy and community property with right of survivorship (both allow for reversion to
remaining owners)
A statement of the goals and policies regarding growth of a community is a good definition
of the -correct answer-general plan.
,The primary difference between a common interest subdivision and a standard subdivision is
-correct answer-ownership of common areas.
Which of the following is a generic term for a group of people joining together to invest in
real estate? -correct answer-syndicate
The proper way for a landowner who has physical difficulty in developing his property to get
relief is to obtain a -correct answer-variance.
When is a landowner entitled to compensation for a change in zoning? -correct answer-
when the landowner is denied all practical economic use of the property
At which lot does the Subdivided Lands Law take effect? -correct answer-the fifth lot
The state has enacted legislation providing special consideration or control for development
of -correct answer-rangeland, earthquake areas & coastal areas
The land that benefits from an easement is referred to as the -correct answer-dominant
tenement.
All liens are encumbrances. All encumbrances are -correct answer-limitations.
A deed restriction prohibiting the sale of property to certain ethnic groups -correct answer-is
illegal and unenforceable.
A mechanic's lien creates -correct answer-a cloud on title.
A private deed restriction that places a restraint on alienation -correct answer-is void,
restricts the sale of property and is unenforceable.
An easement is an encumbrance -correct answer-always.
The seller of a one-family house is required to disclose to buyers -correct answer-the
structural and mechanical condition of the property.
The process by which eminent domain occurs is called -correct answer-police power.
An agent represents a -correct answer-principal.
Which of the following types of easement does not run with the land? -correct answer-the
electric company's easement to cross over your land with their power lines
What is another term for an agent entrusted to act on someone's behalf? -correct answer-
fiduciary
The agent who brings a ready, willing, and able buyer to a seller is commonly called the -
correct answer-procuring cause.
,Broker A agrees to represent Seller B in the sale of her house. Seller B agrees to pay Broker A
a commission if he successfully sells the house. What do we know for certain based on these
facts? -correct answer-A bilateral express contract exists between Broker A and Seller B
Broker A has a listing agreement to sell Seller B's house. Broker A brings an offer to Seller B
on behalf of Buyer C. Seller B rejects the offer and a week later attempts to negotiate
directly with Buyer C. Seller B has violated -correct answer-the duty of care.
Seller A wants to walk away with $200,000 after the sale of her house and all expenses are
paid. She agrees that Broker B can keep, as his fee, anything he gets above that. What type
of agreement have they made? -correct answer-a net listing
Seller A has signed a listing agreement with Broker B. Without the assistance of Broker B,
Seller A sells her property and under the terms of the listing agreement owes no commission
to Broker B. What type of listing agreement did Seller A sign? -correct answer-an exclusive
agency listing
A cooperating broker may represent -correct answer-the buyer or the seller or the listing
broker
This is not a type of listing agreement? -correct answer-multiple listing
Broker A has a listing to market Seller B's house. He also has a buyer's agency agreement to
find a house for Buyer C. If Buyer C becomes interested in Seller B's house what might the
danger be, if any, to Broker A? -correct answer-the creation of a dual agency (this can be
taken care of by disclosing to both parties)
Who of the following owes fiduciary responsibility to the buyer? -correct answer-the buyer's
agent
A broker hired to sell a house is considered a -correct answer-special agent.
A real estate salesperson is always considered an -correct answer-employee.
Seller A wants to get the broadest exposure for the sale of her house but does not want to
pay a commission if she sells the house herself. What type of listing will she try to establish?
-correct answer-open listing
All agency agreements for the sale of property must be in writing except creation of an
agency by -correct answer-there are no exceptions.
The most profitable single use that will generate the highest value for a piece of property is
called it's -correct answer-highest and best use.
Broker A agrees in writing to keep details of Seller B's property in his files but indicated that
he will not actively market it. Seller B agrees to pay Broker A a commission if he finds a
buyer. This agreement would best be described as -correct answer-express unilateral.
, Which of the following is not a characteristic of value? -correct answer-change
An uncashed deposit check usually may be held and not deposited by the broker for how
many days before an offer is accepted? -correct answer-until the offer is accepted
Two lots, each valued at $50,000, when combined have a value of $125,000. What term best
describes this added value? -correct answer-plottage
What is deducted from potential gross income to arrive at an effective gross income? -
correct answer-vacancy and collection loss
In the income approach to estimating value, another term for the capitalization rate is -
correct answer-rate of return.
In appraising a property, the process by which dissimilarities are accounted for in comparing
a subject property and a comparable property is called -correct answer-making adjustments.
An appraisal may have more than one date on it. The date of the value estimate is the -
correct answer-effective date.
What is an example of functional obsolescence? -correct answer-having to get to a bedroom
by going through another bedroom
If you assume that depreciation occurs at an even rate, what method of calculating
depreciation would you be using? -correct answer-economic age life method
A parking lot in a downtown area being developed with office buildings is most likely -
correct answer-an interim use of the property.
Potential gross income of an investment property is the same as -correct answer-market rent
plus other building income.
The gross rent multiplier approach is a useful income approach in appraising -correct
answer-single-family homes.
Which approach to valuation estimates land and building value separately? -correct answer-
cost approach
In order to arrive at a final value estimate after applying all three approaches to value, which
of the following will an appraiser do? -correct answer-Reconcile the three values.
What type of value is the term advalorem most closely associated with? -correct answer-
assessed value
Rising mortgage interest rates will tend to -correct answer-lower property values.
What activities of the Federal Reserve System is likely to have the most direct effect on the
rates charged for consumer credit? -correct answer-adjusting the discount rate
Broker A receives two offers on Seller B's house, which is listed for sale at $250,000. The first
offer is for all cash at $200,000. The second offer is for 20% down with 80% financing for the
full price. What should the broker do with respect to both offers? -correct answer-Present
both offers to the seller as soon as possible.
The two primary documents dealing with payment of a loan are the mortgage or deed of
trust and a -correct answer-promissory note.
The term that best describes a continuous urban corridor joining at least two cities is -
correct answer-megalopolis.
The term real property can also be described as -correct answer-the bundle of rights.
The rights of a landowner to a river bordering her property are known as -correct answer-
riparian rights.
In the case of a transfer of ownership of a piece of real estate, a fixture is normally -correct
answer-assumed to be included in the transfer.
A tenant who operates a jewelry store wants to take his jewelry cases with him at the
expiration of the lease. What is the best solution? -correct answer-He may take the cases if
removal will not cause substantial damage.
A legal description of property is not adequate unless -correct answer-land boundaries are
defined.
The lot and block system of property description is not also known as the -correct answer-
rectangular survey system.
What best describes the interests of the holder of a life estate? -correct answer-possession,
use, and ownership
How many acres does a section of land contain? -correct answer-640 acres
The requirement that multiple owners take title to property at the same time is a
characteristic of -correct answer-joint tenancy.
The type of ownership that provides the most complete bundle of rights is -correct answer-
fee simple absolute.
Which are most similar to each other with respect to inheriting property? -correct answer-
joint tenancy and community property with right of survivorship (both allow for reversion to
remaining owners)
A statement of the goals and policies regarding growth of a community is a good definition
of the -correct answer-general plan.
,The primary difference between a common interest subdivision and a standard subdivision is
-correct answer-ownership of common areas.
Which of the following is a generic term for a group of people joining together to invest in
real estate? -correct answer-syndicate
The proper way for a landowner who has physical difficulty in developing his property to get
relief is to obtain a -correct answer-variance.
When is a landowner entitled to compensation for a change in zoning? -correct answer-
when the landowner is denied all practical economic use of the property
At which lot does the Subdivided Lands Law take effect? -correct answer-the fifth lot
The state has enacted legislation providing special consideration or control for development
of -correct answer-rangeland, earthquake areas & coastal areas
The land that benefits from an easement is referred to as the -correct answer-dominant
tenement.
All liens are encumbrances. All encumbrances are -correct answer-limitations.
A deed restriction prohibiting the sale of property to certain ethnic groups -correct answer-is
illegal and unenforceable.
A mechanic's lien creates -correct answer-a cloud on title.
A private deed restriction that places a restraint on alienation -correct answer-is void,
restricts the sale of property and is unenforceable.
An easement is an encumbrance -correct answer-always.
The seller of a one-family house is required to disclose to buyers -correct answer-the
structural and mechanical condition of the property.
The process by which eminent domain occurs is called -correct answer-police power.
An agent represents a -correct answer-principal.
Which of the following types of easement does not run with the land? -correct answer-the
electric company's easement to cross over your land with their power lines
What is another term for an agent entrusted to act on someone's behalf? -correct answer-
fiduciary
The agent who brings a ready, willing, and able buyer to a seller is commonly called the -
correct answer-procuring cause.
,Broker A agrees to represent Seller B in the sale of her house. Seller B agrees to pay Broker A
a commission if he successfully sells the house. What do we know for certain based on these
facts? -correct answer-A bilateral express contract exists between Broker A and Seller B
Broker A has a listing agreement to sell Seller B's house. Broker A brings an offer to Seller B
on behalf of Buyer C. Seller B rejects the offer and a week later attempts to negotiate
directly with Buyer C. Seller B has violated -correct answer-the duty of care.
Seller A wants to walk away with $200,000 after the sale of her house and all expenses are
paid. She agrees that Broker B can keep, as his fee, anything he gets above that. What type
of agreement have they made? -correct answer-a net listing
Seller A has signed a listing agreement with Broker B. Without the assistance of Broker B,
Seller A sells her property and under the terms of the listing agreement owes no commission
to Broker B. What type of listing agreement did Seller A sign? -correct answer-an exclusive
agency listing
A cooperating broker may represent -correct answer-the buyer or the seller or the listing
broker
This is not a type of listing agreement? -correct answer-multiple listing
Broker A has a listing to market Seller B's house. He also has a buyer's agency agreement to
find a house for Buyer C. If Buyer C becomes interested in Seller B's house what might the
danger be, if any, to Broker A? -correct answer-the creation of a dual agency (this can be
taken care of by disclosing to both parties)
Who of the following owes fiduciary responsibility to the buyer? -correct answer-the buyer's
agent
A broker hired to sell a house is considered a -correct answer-special agent.
A real estate salesperson is always considered an -correct answer-employee.
Seller A wants to get the broadest exposure for the sale of her house but does not want to
pay a commission if she sells the house herself. What type of listing will she try to establish?
-correct answer-open listing
All agency agreements for the sale of property must be in writing except creation of an
agency by -correct answer-there are no exceptions.
The most profitable single use that will generate the highest value for a piece of property is
called it's -correct answer-highest and best use.
Broker A agrees in writing to keep details of Seller B's property in his files but indicated that
he will not actively market it. Seller B agrees to pay Broker A a commission if he finds a
buyer. This agreement would best be described as -correct answer-express unilateral.
, Which of the following is not a characteristic of value? -correct answer-change
An uncashed deposit check usually may be held and not deposited by the broker for how
many days before an offer is accepted? -correct answer-until the offer is accepted
Two lots, each valued at $50,000, when combined have a value of $125,000. What term best
describes this added value? -correct answer-plottage
What is deducted from potential gross income to arrive at an effective gross income? -
correct answer-vacancy and collection loss
In the income approach to estimating value, another term for the capitalization rate is -
correct answer-rate of return.
In appraising a property, the process by which dissimilarities are accounted for in comparing
a subject property and a comparable property is called -correct answer-making adjustments.
An appraisal may have more than one date on it. The date of the value estimate is the -
correct answer-effective date.
What is an example of functional obsolescence? -correct answer-having to get to a bedroom
by going through another bedroom
If you assume that depreciation occurs at an even rate, what method of calculating
depreciation would you be using? -correct answer-economic age life method
A parking lot in a downtown area being developed with office buildings is most likely -
correct answer-an interim use of the property.
Potential gross income of an investment property is the same as -correct answer-market rent
plus other building income.
The gross rent multiplier approach is a useful income approach in appraising -correct
answer-single-family homes.
Which approach to valuation estimates land and building value separately? -correct answer-
cost approach
In order to arrive at a final value estimate after applying all three approaches to value, which
of the following will an appraiser do? -correct answer-Reconcile the three values.
What type of value is the term advalorem most closely associated with? -correct answer-
assessed value
Rising mortgage interest rates will tend to -correct answer-lower property values.
What activities of the Federal Reserve System is likely to have the most direct effect on the
rates charged for consumer credit? -correct answer-adjusting the discount rate
