California Real Estate Exam Multiple Choice Questions and Answers Revision
Essential
"A" has been given power of attorney for the purpose of selling "B's" house. Which of the
following is NOT true?
a. "A" cannot sell the property if "B" has recorded a homestead on it.
b. Power of attorney must be recorded for "A" to sell the property.
c. Power of attorney is terminated in the event "B" is declared incompetent and unable to enter
into a legal contract.
d. "A" may purchase the property, providing he/she pays a fair market value for the home. -
✔✔✔-d. "A" may purchase the property, providing he/she pays a fair market value for the
home.
An attorney-in-fact cannot deed or convey the property to self. If he desires to purchase it,
he/she must "give up" the power of attorney.
"Domicile" most frequently means:
a. semi-circled ceiling.
b. relationship of parties.
c. home or residence.
d. none of above. - ✔✔✔-c. home or residence.
"Gross multiplier" is used to determine value of certain types of income properties. It is
determined by:
a. dividing the gross rental income by the appraised value. b. multiplying the market price by
the capitalization rate.
c. dividing the sales price by the gross monthly rental.
,California Real Estate Exam Multiple Choice Questions and Answers Revision
Essential
d. multiplying the gross monthly rental by a reasonable cap rate. - ✔✔✔-c. dividing the sales
price by the gross monthly rental.
Gross Rent Multiplier is a rough, quick way of converting gross rent into market value.
"Moral philosophy" best matches:
a. ethnics.
b. ethics.
c. dedication.
d. subordination. - ✔✔✔-b. ethics.
"Placement of a home on a lot" best matches:
a. option.
b. avulsion.
c. dedication.
d. plot plan. - ✔✔✔-d. plot plan.
Plot plan is planning the most advantageous place on a parcel of land for an improvement to be
located.
"The right of one or more persons to possess and use something to the exclusion of others"
describes:
a. discrimination.
,California Real Estate Exam Multiple Choice Questions and Answers Revision
Essential
b. novation.
c. ownership.
d. equity. - ✔✔✔-c. ownership.
*A broker obtained an exclusive listing to sell a piece of property. He spent much time, money,
and energy. The seller refused to allow the broker to proceed under the agreement. The broker
should:
a. consider the seller's refusal a breach and sue for damages.
b. consider the seller's refusal a breach and claim the amount of commission as liquidated
damages.
c. ignore the seller and proceed.
d. relieve seller of liability, and work on improving relationship so as to enable retaining future
business. - ✔✔✔-a. consider the seller's refusal a breach and sue for damages.
When seen from a technical point of view. In reality, sometimes "d" would result in more
favorable and profitable end results.
*For federal income tax purposes, a taxpayer could increase the basis of his/her residence with
which of the following?
a. Property taxes
b. Accrued depreciation
c. Addition of a patio
d. None of the above, for a personal residence basis cannot be adjusted for any reason - ✔✔✔-
c. Addition of a patio
Capital improvements are acceptable adjustments to basis.
, California Real Estate Exam Multiple Choice Questions and Answers Revision
Essential
*Which of the following phrases would best bind all parties to pay their debts?
a. Jointly
b. Individually
c. Individually and severally
d. Jointly and severally - ✔✔✔-d. Jointly and severally
All parties are held responsible collectively or individually for the entire obligation.
1. A real property security endorsement is valid for:
a. as long as the broker's license is valid, and it needs no further endorsement.
b. multiples of 4 years.
c. one year.
d. the term of the broker's license to which the endorsement is affixed. - ✔✔✔-d. the term of
the broker's license to which the endorsement is affixed.
10. Considering the "Interstate Land Sales Full Disclosure Act," which of the following is NOT
true?
a. Controls subdivisions of 25 (or more) lots, unimproved at the time of sale.
b. Developer must register subdivision with Office of Inter-Land Sales Registration (OILSR), and
provide copy of
"property report" to purchaser or lessee.
c. Any contract to purchase or lease may be revoked by purchaser or lessee within 7 days of
signing the contract.
Essential
"A" has been given power of attorney for the purpose of selling "B's" house. Which of the
following is NOT true?
a. "A" cannot sell the property if "B" has recorded a homestead on it.
b. Power of attorney must be recorded for "A" to sell the property.
c. Power of attorney is terminated in the event "B" is declared incompetent and unable to enter
into a legal contract.
d. "A" may purchase the property, providing he/she pays a fair market value for the home. -
✔✔✔-d. "A" may purchase the property, providing he/she pays a fair market value for the
home.
An attorney-in-fact cannot deed or convey the property to self. If he desires to purchase it,
he/she must "give up" the power of attorney.
"Domicile" most frequently means:
a. semi-circled ceiling.
b. relationship of parties.
c. home or residence.
d. none of above. - ✔✔✔-c. home or residence.
"Gross multiplier" is used to determine value of certain types of income properties. It is
determined by:
a. dividing the gross rental income by the appraised value. b. multiplying the market price by
the capitalization rate.
c. dividing the sales price by the gross monthly rental.
,California Real Estate Exam Multiple Choice Questions and Answers Revision
Essential
d. multiplying the gross monthly rental by a reasonable cap rate. - ✔✔✔-c. dividing the sales
price by the gross monthly rental.
Gross Rent Multiplier is a rough, quick way of converting gross rent into market value.
"Moral philosophy" best matches:
a. ethnics.
b. ethics.
c. dedication.
d. subordination. - ✔✔✔-b. ethics.
"Placement of a home on a lot" best matches:
a. option.
b. avulsion.
c. dedication.
d. plot plan. - ✔✔✔-d. plot plan.
Plot plan is planning the most advantageous place on a parcel of land for an improvement to be
located.
"The right of one or more persons to possess and use something to the exclusion of others"
describes:
a. discrimination.
,California Real Estate Exam Multiple Choice Questions and Answers Revision
Essential
b. novation.
c. ownership.
d. equity. - ✔✔✔-c. ownership.
*A broker obtained an exclusive listing to sell a piece of property. He spent much time, money,
and energy. The seller refused to allow the broker to proceed under the agreement. The broker
should:
a. consider the seller's refusal a breach and sue for damages.
b. consider the seller's refusal a breach and claim the amount of commission as liquidated
damages.
c. ignore the seller and proceed.
d. relieve seller of liability, and work on improving relationship so as to enable retaining future
business. - ✔✔✔-a. consider the seller's refusal a breach and sue for damages.
When seen from a technical point of view. In reality, sometimes "d" would result in more
favorable and profitable end results.
*For federal income tax purposes, a taxpayer could increase the basis of his/her residence with
which of the following?
a. Property taxes
b. Accrued depreciation
c. Addition of a patio
d. None of the above, for a personal residence basis cannot be adjusted for any reason - ✔✔✔-
c. Addition of a patio
Capital improvements are acceptable adjustments to basis.
, California Real Estate Exam Multiple Choice Questions and Answers Revision
Essential
*Which of the following phrases would best bind all parties to pay their debts?
a. Jointly
b. Individually
c. Individually and severally
d. Jointly and severally - ✔✔✔-d. Jointly and severally
All parties are held responsible collectively or individually for the entire obligation.
1. A real property security endorsement is valid for:
a. as long as the broker's license is valid, and it needs no further endorsement.
b. multiples of 4 years.
c. one year.
d. the term of the broker's license to which the endorsement is affixed. - ✔✔✔-d. the term of
the broker's license to which the endorsement is affixed.
10. Considering the "Interstate Land Sales Full Disclosure Act," which of the following is NOT
true?
a. Controls subdivisions of 25 (or more) lots, unimproved at the time of sale.
b. Developer must register subdivision with Office of Inter-Land Sales Registration (OILSR), and
provide copy of
"property report" to purchaser or lessee.
c. Any contract to purchase or lease may be revoked by purchaser or lessee within 7 days of
signing the contract.
