Law of Agency Practice Exam Questions and Answers (Verified Solutions)

Law of Agency Practice Exam Questions and Answers (Verified Solutions) A buyer's agent may not tell the buyer any information told to the agent by the owner: False If a salesperson is an employee, the broker/employer must withhold income tax and Social Security from the salesperson compensation True The broker may give the seller advice and opinions about the price of the property and may do a CMA for the seller. The final decision concerning the listing price is made by the: seller Communities for the elderly are exempt from familial status if: The units are occupied by persons 62 or older 80% of the units are occupied by at least one person 55 or older In buyer agency, the broker represents the buyer as a client The maxim amount an unlicensed person can receive for a referral is: $50 The Americans with Disabilities Act was passed in 1992 and primarily pertains to: commercial property For an intermediary transaction to occur there must be ______________ companies involved. one The Texas Real Estate License Act states: a. A broker must act as an intermediary if the broker agrees to represent in a transaction both the buyer and seller b. A broker may act as a dual agent if he does not make appointments c. A broker may appoint two intermediaries in the same transaction d. A broker may act as subagent and an intermediary in the same transaction a An example of loyalty is: Helping a buyer client negotiate a lower price for the property According to the Information About Brokerage Services, a broker may act as a buyer's agent, a seller's agent, a subagent, or an intermediary. true The broker will not receive a commission if the seller sells the property. This is an example of: exclusive agency Zoning changes and structural problems are things that a buyer would want to know about before making a decision to purchase the property. These are referred to as: material facts A broker representing a buyer: a. Will disclose this to the listing broker b. Will reject subagency is offered by the listing broker c. Does not need to disclose representation d. Both A and B D The listing agreement must be in writing to satisfy: Statute of Frauds The Seller's Disclosure Notice must be filled out by: the seller A listing agreement between a seller and broker or a buyer agreement between a buyer and broker is an example of: special agency The Civil Rights Act of 1866 says no one can discriminate because of: race When a broker receives more than one offer: All offers must be presented to the seller. The broker working with the buyer as a customer owes a fiduciary duty to the: seller Brokers should always make it clear to _______________ who they represent in the transaction. Sellers, buyers, and other brokers Next question The Texas Real Estate License Act has requirements concerning a broker: a. Location b. Display of license c. Branch office d. All of the above D The TAR General Information and Notice to a Buyer gives information on: a. Annexation b. Inspections c. Residential service contracts d. All of the above D If a seller orders the licensee to discriminate, the licensee: May not take the listing unless the seller agrees not to discriminate A company that works only with buyers or sellers but not with both is practicing: single agency A buyers representation agreement is only enforceable Within the market area named in the agreement Psychological stigmas: have no physical effect on property A real estate company may put the name of the company on the IABS from as long as the information from TRELA is not changed. T/F TRUE Handicap under the 1988 amendment to the Civil Rights Act of 1968 includes persons infected with AIDS or the HIV virus. T/F TRUE Agency is always created at the ____________ level. broker The most common violations under the Sherman Antitrust Act are: a. Price-fixing b. Boycotting competitors c. Allocation of markets d. All of the above D Errors and Omissions Insurance is malpractice insurance. It is: Offered by insurance companies in Texas The Texas Real Estate Commission was created by the Texas Real Estate License Act in: 1949 When the broker is a subagent of the seller, he is working with the buyer as a: client A salesperson may accept a commission from: Their sponsoring broker In the last several years, Fewer brokers are allowing subagency A guide could be developed by the company to help all licensees learn to make ethical decisions. T/F TRUE The origins of agency relationships began in the United States when the first real estate act was passed in: California, 1919 Blockbusting is used by developers to divide a large block of land into small lots. Homes can then be built on the lots and sold to the public at a profit. T/F FALSE The TAR Residential Buyer/Tenant Representation Agreement states that the buyer's broker is allowed to: a. Represent other prospects b. Show other prospects the same properties shown to the buyer c. Not represent other prospects d. Both A and B D Information About Brokerage Services should always be given and explained: At the beginning of the listing presentation Next question The Information About Brokerage Services states, "Your payment of a fee to a broker does not necessarily establish that the broker represents you." T/F T TRELA states that broker and salespersons license must be displayed in a: apartment locator office The practice of directing home seekers to a neighborhood because of race, religion, color, national origin, sex, handicap, or familial status is: steering ___________ states that a broker must maintain a written policies and procedures manual for the company TREC A property management agreement between a broker and an owner is an example of: general agency The only person who is allowed to give legal advice is: attorney A broker is not allowed to commingle funds. Commingle means to: place the client's money in the broker's account When working with he buyer as a customer the broker may: a. Show property to the buyer b. Fill out an offer for the buyer c. Collect a commission for the transaction d. All of the above D Intermediary agency has: Replaced dual agency A salesperson: May not act as a salesperson until he has a sponsoring broker A broker has shown a property to a customer. The customer assumes from the broker's actions and words, that the agent represents the customer. This is: implied agency There must always be __________ companies involved in a subagency transaction. two The broker representing the owner is referred to as the seller's broker or the listing broker. T/F TRUE The broker must always be licensed and __________ in order to receive a commission: employed A licensee may be told many things in confidence by a client. The licensee may disclose confidential information if: The client gives the agent permission in writing to disclose the information. Agency disclosure is required in: a. Residential transactions b. Commercial transactions c. Neither A or B d. Both A and B D An example of gratuitous agency is: Giving advice and opinions to a customer The TAR Intermediary Relationship Notice names: a. The agent appointed to the seller b. The agent appointed to the buyer c. All agents sponsored by the broker d. Both A and B D Agency after the fact is: agency by ratification