2
FIN402 - Course Exam with accurate detailed solutions
|| || || || || || ||
Capitalization uses __________ net operating income (NOI). || || || || || ||
Xa. single-year
||
b. multiple-year
||
c. last year's
|| ||
d. comparable properties
|| ||
The peaks and valleys of the real estate cycle are typically __________ pronounced when
|| || || || || || || || || || || || || ||
compared to the business cycle. || || || ||
xa. more||
b. less
||
c. equally
||
d. not at all
|| || ||
_____________ involves comparing current income and expenses with amounts from past
|| || || || || || || || || || ||
periods to highlight increases and decreases.
|| || || || ||
Xa. Trend analysis
|| ||
b. Variance analysis
|| ||
c. Loan analysis
|| ||
d. Percentage analysis
|| ||
,2
You have budgeted $18,000 for electric. The actual cost is $16,000. What is the variance?
|| || || || || || || || || || || || || ||
a.$2,000 unfavorable ||
b.$1,000 unfavorable ||
c.$1,000 favorable ||
xd. $2,000 favorable
|| ||
If heat expenses increased by 3% two years ago and 5% last year, what might be a good
|| || || || || || || || || || || || || || || || || ||
multiplier to use for next year's budget using a trending method?
|| || || || || || || || || ||
a. 0.03
||
xb. 0.04
||
c. 0.05
||
d. 0.07
||
A(n) ________ variance lowers NOI.
|| || || ||
a. unfavorable
||
xb. favorable
||
c. neutral
||
d. positive
||
____________ equals operating expenses divided by effective gross income.
|| || || || || || || ||
a. Loan-to-value ratio (LTV%)
|| || ||
b. Debt-coverage ratio (DCR)
|| || ||
xc. Operating expense ratio
|| || ||
, 2
d. Free and clear rate of return
|| || || || || ||
A Class A apartment complex has an annual effective gross income of $550,000 and annual
|| || || || || || || || || || || || || || ||
operating expenses of $375,000. The market capitalization rate for Class A multifamily
|| || || || || || || || || || || ||
properties in this market is 8%. (Questions 8-12) What is the NOI of the apartment
|| || || || || || || || || || || || || || ||
complex?
a. $150,000
||
xb. $175,000
||
c. $550,000
||
d. $925,000
||
A Class A apartment complex has an annual effective gross income of $550,000 and annual
|| || || || || || || || || || || || || || ||
operating expenses of $375,000. The market capitalization rate for Class A multifamily
|| || || || || || || || || || || ||
properties in this market is 8%. || || || || ||
What is the market value of the property?
|| || || || || || ||
a. $1,850,000
||
b. $1,875,000
||
Xc. $2,187,500
||
d. $2,500,000
||
A Class A apartment complex has an annual effective gross income of $550,000 and annual
|| || || || || || || || || || || || || || ||
operating expenses of $375,000. The market capitalization rate for Class A multifamily
|| || || || || || || || || || || ||
properties in this market is 8%. || || || || ||
If a new landscaping company is selected, at a savings of $5,000 annually, how does this
|| || || || || || || || || || || || || || || ||
impact market value? || ||
FIN402 - Course Exam with accurate detailed solutions
|| || || || || || ||
Capitalization uses __________ net operating income (NOI). || || || || || ||
Xa. single-year
||
b. multiple-year
||
c. last year's
|| ||
d. comparable properties
|| ||
The peaks and valleys of the real estate cycle are typically __________ pronounced when
|| || || || || || || || || || || || || ||
compared to the business cycle. || || || ||
xa. more||
b. less
||
c. equally
||
d. not at all
|| || ||
_____________ involves comparing current income and expenses with amounts from past
|| || || || || || || || || || ||
periods to highlight increases and decreases.
|| || || || ||
Xa. Trend analysis
|| ||
b. Variance analysis
|| ||
c. Loan analysis
|| ||
d. Percentage analysis
|| ||
,2
You have budgeted $18,000 for electric. The actual cost is $16,000. What is the variance?
|| || || || || || || || || || || || || ||
a.$2,000 unfavorable ||
b.$1,000 unfavorable ||
c.$1,000 favorable ||
xd. $2,000 favorable
|| ||
If heat expenses increased by 3% two years ago and 5% last year, what might be a good
|| || || || || || || || || || || || || || || || || ||
multiplier to use for next year's budget using a trending method?
|| || || || || || || || || ||
a. 0.03
||
xb. 0.04
||
c. 0.05
||
d. 0.07
||
A(n) ________ variance lowers NOI.
|| || || ||
a. unfavorable
||
xb. favorable
||
c. neutral
||
d. positive
||
____________ equals operating expenses divided by effective gross income.
|| || || || || || || ||
a. Loan-to-value ratio (LTV%)
|| || ||
b. Debt-coverage ratio (DCR)
|| || ||
xc. Operating expense ratio
|| || ||
, 2
d. Free and clear rate of return
|| || || || || ||
A Class A apartment complex has an annual effective gross income of $550,000 and annual
|| || || || || || || || || || || || || || ||
operating expenses of $375,000. The market capitalization rate for Class A multifamily
|| || || || || || || || || || || ||
properties in this market is 8%. (Questions 8-12) What is the NOI of the apartment
|| || || || || || || || || || || || || || ||
complex?
a. $150,000
||
xb. $175,000
||
c. $550,000
||
d. $925,000
||
A Class A apartment complex has an annual effective gross income of $550,000 and annual
|| || || || || || || || || || || || || || ||
operating expenses of $375,000. The market capitalization rate for Class A multifamily
|| || || || || || || || || || || ||
properties in this market is 8%. || || || || ||
What is the market value of the property?
|| || || || || || ||
a. $1,850,000
||
b. $1,875,000
||
Xc. $2,187,500
||
d. $2,500,000
||
A Class A apartment complex has an annual effective gross income of $550,000 and annual
|| || || || || || || || || || || || || || ||
operating expenses of $375,000. The market capitalization rate for Class A multifamily
|| || || || || || || || || || || ||
properties in this market is 8%. || || || || ||
If a new landscaping company is selected, at a savings of $5,000 annually, how does this
|| || || || || || || || || || || || || || || ||
impact market value? || ||
