IAAO 300: Fundamentals of Mass Appraisal Exam
Questions and Answers | Fall 2025/2026
Update | 100% Correct
QUESTION 1
Which of the following best defines mass appraisal?
A. The valuation of a single property based on comparable sales
B. The systematic appraisal of multiple properties as of a given date using standardized
procedures and statistical testing
C. An appraisal conducted without data verification or market analysis
D. The valuation of a property based on cost alone
CORRECT ANSWER: B
RATIONALE: Mass appraisal is the systematic valuation of a group of properties as of a given
date using common data, standardized procedures, and statistical testing to ensure uniformity
and equity across the sample.
QUESTION 2
In the cost approach, the replacement cost new is defined as:
A. The cost to reproduce an exact replica of the structure using original materials
B. The cost to build an equivalent building using current materials and standards
C. The depreciated value of a building in use
D. The total market value minus land value
CORRECT ANSWER: B
RATIONALE: Replacement cost new refers to the cost to construct a building with equivalent
utility using modern materials and current design standards, differentiating it from reproduction
cost, which replicates the original exactly.
QUESTION 3
Which data set is most critical for developing a reliable multiple regression model in mass
appraisal?
,A. Assessed values from the previous assessment year
B. Market sale prices, verified property characteristics, and accurate date of sale
C. Taxpayer protest records
D. Construction cost estimates
CORRECT ANSWER: B
RATIONALE: Accurate, verified market sale data paired with property characteristics is essential
for developing defensible regression models, as these reveal true market relationships among
variables.
QUESTION 4
True or False: Calibration in mass appraisal refers to the process of adjusting model coefficients
to improve predictive accuracy.
CORRECT ANSWER: True
RATIONALE: Calibration fine-tunes model coefficients to minimize error and align predicted
values with observed market data, ensuring the model reflects current market behavior.
QUESTION 5
The Coefficient of Dispersion (COD) measures:
A. The central tendency of appraised values
B. The accuracy of model calibration
C. The average percentage deviation of individual ratios from the median ratio
D. The correlation between sale price and appraised value
CORRECT ANSWER: C
RATIONALE: COD quantifies uniformity by showing how much individual assessment-to-sale price
ratios vary around the median. Lower CODs indicate better uniformity across properties.
QUESTION 6
Which of the following is not a step in the mass appraisal process according to IAAO standards?
A. Data collection and maintenance
B. Model specification and calibration
C. Individual property negotiation
D. Valuation testing and performance review
,CORRECT ANSWER: C
RATIONALE: Mass appraisal employs standardized, objective methods rather than negotiations
with property owners, which apply to single-property appraisals.
QUESTION 7
When conducting ratio studies, the median is preferred over the mean because:
A. It is easier to calculate manually
B. It is unaffected by extreme ratios
C. It ignores sample size effects
D. It emphasizes high-value properties
CORRECT ANSWER: B
RATIONALE: The median is less affected by outliers than the mean, providing a more stable
measure of central tendency in ratio analysis.
QUESTION 8
The supply and demand principle primarily affects which appraisal approach?
A. Cost approach
B. Sales comparison approach
C. Income approach
D. All approaches equally
CORRECT ANSWER: D
RATIONALE: Supply and demand underlie all valuation methods as they influence market prices,
construction costs, and income potential.
QUESTION 9
In the income approach, the capitalization rate reflects all of the following EXCEPT:
A. Risk of investment
B. Expectations of profit and loss
C. Depreciation of the cost model
D. Relationship between income and value
, CORRECT ANSWER: C
RATIONALE: Depreciation pertains to the cost approach; capitalization rates express the
investor’s required return, risk, and market conditions.
QUESTION 10
A property sells for $250,000 and is appraised at $240,000. The ratio (appraisal-to-sale price) is:
A. 1.04
B. 0.96
C. 0.90
D. 1.10
CORRECT ANSWER: B
RATIONALE: The assessment ratio equals 240,000 ÷ 250,000 = 0.96, meaning the property is
assessed at 96% of its market value.
QUESTION 11
Multiple regression models in mass appraisal require which assumption to be valid?
A. The dependent and independent variables are independent of one another
B. The residuals are randomly distributed with a mean of zero
C. The model must explain 100% of value variation
D. The sample must only contain owner-occupied properties
CORRECT ANSWER: B
RATIONALE: Valid regression models rely on residuals that are random and normally distributed
around zero; this ensures the model is unbiased and properly specified.
QUESTION 12
The effective age of a structure is determined primarily by:
A. Its chronological age
B. Its physical condition and modernization
C. The neighborhood age
D. The expected remaining economic life
CORRECT ANSWER: B
RATIONALE: Effective age reflects the structure’s actual condition and functional utility rather
than just the number of years since construction.
Questions and Answers | Fall 2025/2026
Update | 100% Correct
QUESTION 1
Which of the following best defines mass appraisal?
A. The valuation of a single property based on comparable sales
B. The systematic appraisal of multiple properties as of a given date using standardized
procedures and statistical testing
C. An appraisal conducted without data verification or market analysis
D. The valuation of a property based on cost alone
CORRECT ANSWER: B
RATIONALE: Mass appraisal is the systematic valuation of a group of properties as of a given
date using common data, standardized procedures, and statistical testing to ensure uniformity
and equity across the sample.
QUESTION 2
In the cost approach, the replacement cost new is defined as:
A. The cost to reproduce an exact replica of the structure using original materials
B. The cost to build an equivalent building using current materials and standards
C. The depreciated value of a building in use
D. The total market value minus land value
CORRECT ANSWER: B
RATIONALE: Replacement cost new refers to the cost to construct a building with equivalent
utility using modern materials and current design standards, differentiating it from reproduction
cost, which replicates the original exactly.
QUESTION 3
Which data set is most critical for developing a reliable multiple regression model in mass
appraisal?
,A. Assessed values from the previous assessment year
B. Market sale prices, verified property characteristics, and accurate date of sale
C. Taxpayer protest records
D. Construction cost estimates
CORRECT ANSWER: B
RATIONALE: Accurate, verified market sale data paired with property characteristics is essential
for developing defensible regression models, as these reveal true market relationships among
variables.
QUESTION 4
True or False: Calibration in mass appraisal refers to the process of adjusting model coefficients
to improve predictive accuracy.
CORRECT ANSWER: True
RATIONALE: Calibration fine-tunes model coefficients to minimize error and align predicted
values with observed market data, ensuring the model reflects current market behavior.
QUESTION 5
The Coefficient of Dispersion (COD) measures:
A. The central tendency of appraised values
B. The accuracy of model calibration
C. The average percentage deviation of individual ratios from the median ratio
D. The correlation between sale price and appraised value
CORRECT ANSWER: C
RATIONALE: COD quantifies uniformity by showing how much individual assessment-to-sale price
ratios vary around the median. Lower CODs indicate better uniformity across properties.
QUESTION 6
Which of the following is not a step in the mass appraisal process according to IAAO standards?
A. Data collection and maintenance
B. Model specification and calibration
C. Individual property negotiation
D. Valuation testing and performance review
,CORRECT ANSWER: C
RATIONALE: Mass appraisal employs standardized, objective methods rather than negotiations
with property owners, which apply to single-property appraisals.
QUESTION 7
When conducting ratio studies, the median is preferred over the mean because:
A. It is easier to calculate manually
B. It is unaffected by extreme ratios
C. It ignores sample size effects
D. It emphasizes high-value properties
CORRECT ANSWER: B
RATIONALE: The median is less affected by outliers than the mean, providing a more stable
measure of central tendency in ratio analysis.
QUESTION 8
The supply and demand principle primarily affects which appraisal approach?
A. Cost approach
B. Sales comparison approach
C. Income approach
D. All approaches equally
CORRECT ANSWER: D
RATIONALE: Supply and demand underlie all valuation methods as they influence market prices,
construction costs, and income potential.
QUESTION 9
In the income approach, the capitalization rate reflects all of the following EXCEPT:
A. Risk of investment
B. Expectations of profit and loss
C. Depreciation of the cost model
D. Relationship between income and value
, CORRECT ANSWER: C
RATIONALE: Depreciation pertains to the cost approach; capitalization rates express the
investor’s required return, risk, and market conditions.
QUESTION 10
A property sells for $250,000 and is appraised at $240,000. The ratio (appraisal-to-sale price) is:
A. 1.04
B. 0.96
C. 0.90
D. 1.10
CORRECT ANSWER: B
RATIONALE: The assessment ratio equals 240,000 ÷ 250,000 = 0.96, meaning the property is
assessed at 96% of its market value.
QUESTION 11
Multiple regression models in mass appraisal require which assumption to be valid?
A. The dependent and independent variables are independent of one another
B. The residuals are randomly distributed with a mean of zero
C. The model must explain 100% of value variation
D. The sample must only contain owner-occupied properties
CORRECT ANSWER: B
RATIONALE: Valid regression models rely on residuals that are random and normally distributed
around zero; this ensures the model is unbiased and properly specified.
QUESTION 12
The effective age of a structure is determined primarily by:
A. Its chronological age
B. Its physical condition and modernization
C. The neighborhood age
D. The expected remaining economic life
CORRECT ANSWER: B
RATIONALE: Effective age reflects the structure’s actual condition and functional utility rather
than just the number of years since construction.
