IAAO TEST VERSION 2 EXAM 2025/2026 WITH
ACTUAL CORRECT QUESTIONS AND
VERIFIED DETAILED ANSWERS
|FREQUENTLY TESTED QUESTIONS AND
SOLUTIONS|ALREADY GRADED
A+|NEWEST|BRAND NEW VERSION!!|LATEST
UPDATE
Which of the following is a situation in which the cost approach is the most applicable in
estimating value?
Valuing New or proposed construction for which the land value is well supported; Developing an
opinion of the market or use value of special purpose properties; Valuing properties for which
building additions or renovations are being considered
Which of the following is not a characteristic of cost
land value
Which of the following is not an indirect cost?
Supervision
Which of the following methods of estimating cost is the easiest, fastest, and most widely used
method of estimating cost?
Comparative Unit
An indirect method of measuring depreciation is the
Sales comparison method
The taxable location of personal property is referred to as its
Situs
1|Page
,An estimate of value usually in writing of an adequately described property as of a given date is
termed an
appraisal
A jurisdictions tax rate is determined by dividing the _______________ to be derived from the
property tax by the total _____________________ ____________________
___________________________ of the taxing jurisdiction.
budget; property assessed value
The type of value usually estimated by the assessor is __________________ value
Market
The _____________________________________ reflects the ratio between the current tax bill
and the property value
effective tax rate
in order for a property to have value, it must have _____________, ___________________,
_______________________________, and
__________________________________________________________________________.
utility, scarcity, desirabiltiy and effective purchasing power (DUST)
The use that generates the highest net return to a property over a reasonable time period is
called its
highest and best use
The principle of ______________ states that maximum value of a neighborhood is attained
when the uses of land are perfectly complementary
balance
which appraisal principle affirms that land cannot be valued on the basis of one use while
improvements are valued on the basis of another
principle of consistent use
List the four tests that the appraiser must make in the analysis of its highest and best us
legally permissable, physically possible, financially feasible, maximally productive
_______________________________ is a parcel of land and any structures or improvements
that are permanently affixed thereto.
2|Page
, Real Estate
property is considered ________________________ if it can be moved without causing any
damage or change to either the item or property or the structure to which it is attached
personal
Assessment level times the tax rate equals the
___________________________________________
effective tax rate
____________________________ is the point at which the forces of supply and forces or
demand meet.
Equilibrium
Two types of highest and best us analysis
Analysis of a site as if vacant & analysis of a site as if improved
the typical life cycle of a neighborhood includes
________________________________________________________ and ______________
growth, stability, decline and revitalization
Elements of the marketplace are most likely to contribute to a change in demand
consumer taste and preferance
consumer income
price of related commodities
consumer expectations
price of commoditiy
Market value is defined as the most probable price of a property in terms of money, assuming
1. buyer and seller are typically motivated
2. a reasonable time is allowed for exposure in the open market
3. payment is made in terms of cash in US dollars or in terms of financial arrangements
comparable thereto
_______________________ refers to the amount of goods that producers are willing to sell at a
given price during a specified time period
Supply
Ownership of all legal rights to a property is limited by government in four ways
3|Page
ACTUAL CORRECT QUESTIONS AND
VERIFIED DETAILED ANSWERS
|FREQUENTLY TESTED QUESTIONS AND
SOLUTIONS|ALREADY GRADED
A+|NEWEST|BRAND NEW VERSION!!|LATEST
UPDATE
Which of the following is a situation in which the cost approach is the most applicable in
estimating value?
Valuing New or proposed construction for which the land value is well supported; Developing an
opinion of the market or use value of special purpose properties; Valuing properties for which
building additions or renovations are being considered
Which of the following is not a characteristic of cost
land value
Which of the following is not an indirect cost?
Supervision
Which of the following methods of estimating cost is the easiest, fastest, and most widely used
method of estimating cost?
Comparative Unit
An indirect method of measuring depreciation is the
Sales comparison method
The taxable location of personal property is referred to as its
Situs
1|Page
,An estimate of value usually in writing of an adequately described property as of a given date is
termed an
appraisal
A jurisdictions tax rate is determined by dividing the _______________ to be derived from the
property tax by the total _____________________ ____________________
___________________________ of the taxing jurisdiction.
budget; property assessed value
The type of value usually estimated by the assessor is __________________ value
Market
The _____________________________________ reflects the ratio between the current tax bill
and the property value
effective tax rate
in order for a property to have value, it must have _____________, ___________________,
_______________________________, and
__________________________________________________________________________.
utility, scarcity, desirabiltiy and effective purchasing power (DUST)
The use that generates the highest net return to a property over a reasonable time period is
called its
highest and best use
The principle of ______________ states that maximum value of a neighborhood is attained
when the uses of land are perfectly complementary
balance
which appraisal principle affirms that land cannot be valued on the basis of one use while
improvements are valued on the basis of another
principle of consistent use
List the four tests that the appraiser must make in the analysis of its highest and best us
legally permissable, physically possible, financially feasible, maximally productive
_______________________________ is a parcel of land and any structures or improvements
that are permanently affixed thereto.
2|Page
, Real Estate
property is considered ________________________ if it can be moved without causing any
damage or change to either the item or property or the structure to which it is attached
personal
Assessment level times the tax rate equals the
___________________________________________
effective tax rate
____________________________ is the point at which the forces of supply and forces or
demand meet.
Equilibrium
Two types of highest and best us analysis
Analysis of a site as if vacant & analysis of a site as if improved
the typical life cycle of a neighborhood includes
________________________________________________________ and ______________
growth, stability, decline and revitalization
Elements of the marketplace are most likely to contribute to a change in demand
consumer taste and preferance
consumer income
price of related commodities
consumer expectations
price of commoditiy
Market value is defined as the most probable price of a property in terms of money, assuming
1. buyer and seller are typically motivated
2. a reasonable time is allowed for exposure in the open market
3. payment is made in terms of cash in US dollars or in terms of financial arrangements
comparable thereto
_______________________ refers to the amount of goods that producers are willing to sell at a
given price during a specified time period
Supply
Ownership of all legal rights to a property is limited by government in four ways
3|Page
