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Study Essentials: Fully Solved Q&A for First-Attempt Exam
Success 2025/2026
What is contract rent correct answer
The rent stated in the lease
What is economic rent correct answer
The rent that could be obtained in the current market
What is excess rent correct answer
The difference between the contract rent and the economic rent
What is a positive leasehold correct answer
A lease in which the economic rent is higher than the contract rent (positive excess rent)
What is a negative leasehold correct answer
A lease in which the contract rent is higher than the economic rent (negative excess
rent)
Chapter 8B
Rights of the Lessor and Lessee
What are the two rights of the lessor correct answer
1. The Right to Receive Rent: Landlords collect negotiated rent from tenants at agreed-
upon intervals
2. At the termination of the lease, the right of possession reverts to the lessor
What are the two rights of the lessee correct answer
1. Right of Quiet Enjoyment: The right to use the property without interference by the
lessor or others claiming a superior title
2. Right to Keep Trade Fixtures: Trade fixtures are a tenant's personal property used in
the operation of the tenant's business
a. Examples include partitions, shelves, draperies, and machinery
b. The tenant must remove trade fixtures by the termination of the lease, or the trade
fixtures will belong to the lessor
, What are the four traits of freehold estates and leasehold estates that make them
different from eachother correct answer
Freehold Estate
1. Lasts for an indeterminable length of time
2. May be passed on to the owners heirs
3. Seller/Giver of Interest: Grantor
4. Buyer/Receiver of Interest: Grantee
Leasehold Estate
1. Lasts for a determinable length of time
2. Gives tenant only the right of possession
3. Owner/Landlord: Lessor
4. Tenant: Lessee
What is an estate defined as correct answer
The present or future degree, quantity, nature, and extent of ownership interest and/or
possession that a person has in real property
What are the two major categories of estates correct answer
Freehold and Leasehold
What is a freehold estate correct answer
An ownership interest that can be a fee simple estate or a life estate
Chapter 8B
Fee Simple Estates
What is a Fee Simple Absolute (Fee, Fee Simple, Absolute Fee) correct answer
1. It's the highest and most common form of ownership
2. The owner of a fee simple estate holds all the rights of the bundle, for an indefinite
period of time
Fee Simple Defeasible
A fee simple estate containing conditions that, if violated, could cause the grantee's
ownership to revert to the grantor. The defeasible estate is followed by the future estate
Study Essentials: Fully Solved Q&A for First-Attempt Exam
Success 2025/2026
What is contract rent correct answer
The rent stated in the lease
What is economic rent correct answer
The rent that could be obtained in the current market
What is excess rent correct answer
The difference between the contract rent and the economic rent
What is a positive leasehold correct answer
A lease in which the economic rent is higher than the contract rent (positive excess rent)
What is a negative leasehold correct answer
A lease in which the contract rent is higher than the economic rent (negative excess
rent)
Chapter 8B
Rights of the Lessor and Lessee
What are the two rights of the lessor correct answer
1. The Right to Receive Rent: Landlords collect negotiated rent from tenants at agreed-
upon intervals
2. At the termination of the lease, the right of possession reverts to the lessor
What are the two rights of the lessee correct answer
1. Right of Quiet Enjoyment: The right to use the property without interference by the
lessor or others claiming a superior title
2. Right to Keep Trade Fixtures: Trade fixtures are a tenant's personal property used in
the operation of the tenant's business
a. Examples include partitions, shelves, draperies, and machinery
b. The tenant must remove trade fixtures by the termination of the lease, or the trade
fixtures will belong to the lessor
, What are the four traits of freehold estates and leasehold estates that make them
different from eachother correct answer
Freehold Estate
1. Lasts for an indeterminable length of time
2. May be passed on to the owners heirs
3. Seller/Giver of Interest: Grantor
4. Buyer/Receiver of Interest: Grantee
Leasehold Estate
1. Lasts for a determinable length of time
2. Gives tenant only the right of possession
3. Owner/Landlord: Lessor
4. Tenant: Lessee
What is an estate defined as correct answer
The present or future degree, quantity, nature, and extent of ownership interest and/or
possession that a person has in real property
What are the two major categories of estates correct answer
Freehold and Leasehold
What is a freehold estate correct answer
An ownership interest that can be a fee simple estate or a life estate
Chapter 8B
Fee Simple Estates
What is a Fee Simple Absolute (Fee, Fee Simple, Absolute Fee) correct answer
1. It's the highest and most common form of ownership
2. The owner of a fee simple estate holds all the rights of the bundle, for an indefinite
period of time
Fee Simple Defeasible
A fee simple estate containing conditions that, if violated, could cause the grantee's
ownership to revert to the grantor. The defeasible estate is followed by the future estate
