California Real Estate Exam Multiple
Choice Questions solved.
Standard title insurance policy (CLTA) does NOT provide on-site inspection.
Extended coverage (ALTA) would have covered this type of defect, but a property
inspection would have been made prior to policy issuance anyway.
Qs
Fill in appropriately: "A trend in real estate ______________ the recession trends of
business, and when business starts a swing upward."
a. precedes, proceeds
b. follows, lags behind
c. lags behind, precedes
d. precedes, lags behind - n
Ans✔
d. precedes, lags behind
Typical business cycle:
(1) Expansion...prosperity (good times)
(2) Recession...turn around from prosperity (real estate precedes)
(3) Depression...opposite from (1) above
(4) Revival...turn around in prosperity (real estate lags)
Qs
*For federal income tax purposes, a taxpayer could increase the basis of his/her
residence with which of the following?
a. Property taxes
,b. Accrued depreciation
c. Addition of a patio
d. None of the above, for a personal residence basis cannot be adjusted for any
reason - n
Ans✔
c. Addition of a patio
Capital improvements are acceptable adjustments to basis.
Qs
Under a lease agreement, who holds the leasehold estate?
a. Beneficiary
b. Lessee/Tenant
c. Lessor
d. None of the above - n
Ans✔
b. Lessee/Tenant
Lessor owns the property, lessee holds leasehold estate.
Qs
After a broker shows a client's property to a prospective buyer, the broker should:
a. notify the office staff of the showing by memo.
b. confirm showing with the buyer by written memo.
c. notify the seller in writing as to the prospect's identify.
d. wait until the prospect contacts the owner. - n
Ans✔
c. notify the seller in writing as to the prospect's identify.
,The broker who is the procuring cause of the sale is the one entitled to the
commission. To protect himself, the broker must inform the seller in writing of the
prospects to whom he has shown the property, no later than at the end of the listing
period.
Qs
Appraisers use which of the following methods for estimating costs?
a. Comparative square foot, unit in place
b. Comparative square or cubic foot, unit in place, quantity survey
c. Residual income, resulting from capitalization calculations
d. Replacement costs, resulting from capitalization calculations - n
Ans✔
b. Comparative square or cubic foot, unit in place, quantity survey
There are three accepted methods for cost estimation:
1. comparative square foot or cubic foot, also called the Unit Method
2. Unit cost in place
3. Quantity survey
Qs
A broker arranges the sale of a home. There is a purchase money T.D. from the
lender. The broker is NOT required to see that the T.D. is recorded if the:
a. buyer instructs him not to record.
b. buyer and seller select not to have an escrow.
c. broker is not involved financially in the loan procurement.
d. the beneficiary instructs him not to record the T.D. - n
Ans✔
, d. the beneficiary instructs him not to record the T.D.
Only a lender (beneficiary) can decide whether a promissory note and trust deed
are to be recorded.
Qs
The goal of the Fair Housing Act is for the purpose of:
a. removing prejudice in every community.
b. establishing selling practices that are "color blind."
c. establishing selling practices where you do unto others as you would have them
do unto you.
d. all of the above. - n
Ans✔
d. all of the above.
Qs
In addition to being registered for a minimum of one year, manufactured homes
sold by real
a. 8' wide and 20' long.
b. 6' wide and 40' long.
c. 12' wide and 30' long.
d. 8' wide and 40' long. - n
Ans✔
d. 8' wide and 40' long.
Qs
Which of the following types of financing generally does NOT require any down
payment?
Choice Questions solved.
Standard title insurance policy (CLTA) does NOT provide on-site inspection.
Extended coverage (ALTA) would have covered this type of defect, but a property
inspection would have been made prior to policy issuance anyway.
Qs
Fill in appropriately: "A trend in real estate ______________ the recession trends of
business, and when business starts a swing upward."
a. precedes, proceeds
b. follows, lags behind
c. lags behind, precedes
d. precedes, lags behind - n
Ans✔
d. precedes, lags behind
Typical business cycle:
(1) Expansion...prosperity (good times)
(2) Recession...turn around from prosperity (real estate precedes)
(3) Depression...opposite from (1) above
(4) Revival...turn around in prosperity (real estate lags)
Qs
*For federal income tax purposes, a taxpayer could increase the basis of his/her
residence with which of the following?
a. Property taxes
,b. Accrued depreciation
c. Addition of a patio
d. None of the above, for a personal residence basis cannot be adjusted for any
reason - n
Ans✔
c. Addition of a patio
Capital improvements are acceptable adjustments to basis.
Qs
Under a lease agreement, who holds the leasehold estate?
a. Beneficiary
b. Lessee/Tenant
c. Lessor
d. None of the above - n
Ans✔
b. Lessee/Tenant
Lessor owns the property, lessee holds leasehold estate.
Qs
After a broker shows a client's property to a prospective buyer, the broker should:
a. notify the office staff of the showing by memo.
b. confirm showing with the buyer by written memo.
c. notify the seller in writing as to the prospect's identify.
d. wait until the prospect contacts the owner. - n
Ans✔
c. notify the seller in writing as to the prospect's identify.
,The broker who is the procuring cause of the sale is the one entitled to the
commission. To protect himself, the broker must inform the seller in writing of the
prospects to whom he has shown the property, no later than at the end of the listing
period.
Qs
Appraisers use which of the following methods for estimating costs?
a. Comparative square foot, unit in place
b. Comparative square or cubic foot, unit in place, quantity survey
c. Residual income, resulting from capitalization calculations
d. Replacement costs, resulting from capitalization calculations - n
Ans✔
b. Comparative square or cubic foot, unit in place, quantity survey
There are three accepted methods for cost estimation:
1. comparative square foot or cubic foot, also called the Unit Method
2. Unit cost in place
3. Quantity survey
Qs
A broker arranges the sale of a home. There is a purchase money T.D. from the
lender. The broker is NOT required to see that the T.D. is recorded if the:
a. buyer instructs him not to record.
b. buyer and seller select not to have an escrow.
c. broker is not involved financially in the loan procurement.
d. the beneficiary instructs him not to record the T.D. - n
Ans✔
, d. the beneficiary instructs him not to record the T.D.
Only a lender (beneficiary) can decide whether a promissory note and trust deed
are to be recorded.
Qs
The goal of the Fair Housing Act is for the purpose of:
a. removing prejudice in every community.
b. establishing selling practices that are "color blind."
c. establishing selling practices where you do unto others as you would have them
do unto you.
d. all of the above. - n
Ans✔
d. all of the above.
Qs
In addition to being registered for a minimum of one year, manufactured homes
sold by real
a. 8' wide and 20' long.
b. 6' wide and 40' long.
c. 12' wide and 30' long.
d. 8' wide and 40' long. - n
Ans✔
d. 8' wide and 40' long.
Qs
Which of the following types of financing generally does NOT require any down
payment?
