IAAO 101 QUIZ 2 WITH CORRECT
SOLUTIONS
The cost of producing a building or structure the same utility but using modern
materials, design, and workmanship is called
A. Indirect cost
B. Reproduction cost
C. Replacement cost
D. Direct cost - ANSWER-C. Replacement cost
When a cost manual is being used which one of the following components is not
considered in the inventory of physical characteristics for the building?
A. Heating and cooling
B. Porches
C. Location
D. Current condition - ANSWER-C. Location
The underlying principle in the adjustment process in the sales comparison approach is
he Principle of ___________
A. Substitution
B. Contribution
C. Complementary use
D. Change - ANSWER-B. Contribution
You are analyzing re-sales to determine a time adjustment. You have found a sale that
sold 18 months ago for $200,000 and sold again 8 months ago for $220,000. Based on
this sale, the monthly adjustment for time would be
A. 1%
B. 0.09%
C. 10%
D. 0.89% - ANSWER-A. 1%
Which approach to value is premised on the Principle of Substitution?
A. Cost approach
B. Sales comparison approach
C. Income approach
D. All of the above - ANSWER-D. All of the above
, The Principle of ___________ states that market value is never constant because
environmental, governmental, social, and economic forces are at work influencing the
property and its environment.
A. Supply and demand
B. Change
C. Balance
D. Contribution - ANSWER-B. Change
Which of the following is not an appropriate unit of comparison when multiple -unit
residential properties are being appraised?
A. Price per cubic foot
B. Price per room
C. Price per square foot
D. GIM - ANSWER-A. Price per cubic foot
The cost of building an exact replica of a building is called?
A. Direct cost
B. Indirect cost
C. Replacement cost
D. Reproduction cost - ANSWER-D. Reproduction cost
The cost estimation method that is considered the most accurate but is also the most
time-consuming is the
A. Unit-in-place method
B. Square foot or cubic foot method
C. Trended historical cost method Quantity survey method
D. Quantity survey method - ANSWER-D. Quantity survey method
The first adjustment in the sales comparison approach is
A. Market conditions (time of sale)
B. Financing
C. Location
D. Physical characteristics - ANSWER-B. Financing
When the interaction of supply and demand is being analyzed, which of the following
influences demand?
A. Current inventories
B. Material
C. Local services
D. Capital - ANSWER-C. Local services
SOLUTIONS
The cost of producing a building or structure the same utility but using modern
materials, design, and workmanship is called
A. Indirect cost
B. Reproduction cost
C. Replacement cost
D. Direct cost - ANSWER-C. Replacement cost
When a cost manual is being used which one of the following components is not
considered in the inventory of physical characteristics for the building?
A. Heating and cooling
B. Porches
C. Location
D. Current condition - ANSWER-C. Location
The underlying principle in the adjustment process in the sales comparison approach is
he Principle of ___________
A. Substitution
B. Contribution
C. Complementary use
D. Change - ANSWER-B. Contribution
You are analyzing re-sales to determine a time adjustment. You have found a sale that
sold 18 months ago for $200,000 and sold again 8 months ago for $220,000. Based on
this sale, the monthly adjustment for time would be
A. 1%
B. 0.09%
C. 10%
D. 0.89% - ANSWER-A. 1%
Which approach to value is premised on the Principle of Substitution?
A. Cost approach
B. Sales comparison approach
C. Income approach
D. All of the above - ANSWER-D. All of the above
, The Principle of ___________ states that market value is never constant because
environmental, governmental, social, and economic forces are at work influencing the
property and its environment.
A. Supply and demand
B. Change
C. Balance
D. Contribution - ANSWER-B. Change
Which of the following is not an appropriate unit of comparison when multiple -unit
residential properties are being appraised?
A. Price per cubic foot
B. Price per room
C. Price per square foot
D. GIM - ANSWER-A. Price per cubic foot
The cost of building an exact replica of a building is called?
A. Direct cost
B. Indirect cost
C. Replacement cost
D. Reproduction cost - ANSWER-D. Reproduction cost
The cost estimation method that is considered the most accurate but is also the most
time-consuming is the
A. Unit-in-place method
B. Square foot or cubic foot method
C. Trended historical cost method Quantity survey method
D. Quantity survey method - ANSWER-D. Quantity survey method
The first adjustment in the sales comparison approach is
A. Market conditions (time of sale)
B. Financing
C. Location
D. Physical characteristics - ANSWER-B. Financing
When the interaction of supply and demand is being analyzed, which of the following
influences demand?
A. Current inventories
B. Material
C. Local services
D. Capital - ANSWER-C. Local services
