Texas Principles of Real Estate II Final Exam| Questions and Verified Answers| Grade A| 2023/ 2024 Update

Texas Principles of Real Estate II Final Exam| Questions and Verified Answers| Grade A| 2023/ 2024 Update Q: a lease for one year or less Answer: the only contract that does not have to be in writing to be enforceable Q: Attorney in Fact Answer: a person holding a power of attorney Q: substitution of a contract with another contract ie. counteroffer Answer: Novation Q: when one party fails to perform the duties of the contract-they can be asked by judge to partially perform or substatially perform Answer: breached Q: money offered to seller to entice seller to go under contract Answer: earnest money Q: gives buyer the right to demand legal title to the property when the purchase price is paid Answer: equitable title Q: seller financing and buyer does not get deed until the property has been paid for in full Answer: contract for deed/installment contract Q: that the property may contain lead based paint-Federal Law Answer: if property was built before 1978 seller must disclose _______ is the principle that the more similar properties there are on the market, the lower the price will be driven. Answer: Competition Q: A _____ is made when a property is sold for more than the original price. Answer: Profit Q: A _____ is the bottom number of a fraction. Answer: Denominator Q: A _____ is the top number of a fraction. Answer: Numerator Q: A ______ is a ratio that compares two quantities. Answer: Rate Q: A 20-unit apartment building sells for $5 million. The property can bring in $400,000 in annual gross income. What is the gross income multiplier (GIM)? Answer: 12.5 Q: A form of depreciation or loss in value caused by defects in design is called _______. Answer: Functional obsolescence Q: A licensee must understand risks and provide disclosure of known environmental issues. A licensee must also do which of the following? Answer: Know when to ask questions. Q: A loss in value caused by an undesirable or hazardous influence offsite is which type of depreciation? Answer: External depreciation Q: A property appraises at $320,000. If the assessment rate is 100% and the tax rate is $1 per $100, what are the semi-annual property taxes? Answer: $1,600 Q: A property generates $30,000 in net operating income and has a 15% cap rate. Using the income approach, what is its value? Answer: $200,000 Q: A real estate transaction has a closing date of April 20. The seller, who's responsible for closing costs up to and including the day of settlement, has already paid property taxes of $1,447 for the calendar year. If proration is based on a statutory calendar, the buyer will be_______ on the closing statement. Answer: Debited $1,005 - The buyer will be debited $1005 because the buyer owes the seller this amount for taxes the seller already paid. $1,447 ÷ 360 = $4.02, and $4.02 × 250 days = $1005.