California Real Estate Practice - Questions and Answers

(1) 1. The real estate marketplace could BEST be described as being A. homogeneous B. stratified C. perfect D. uninfluenced by emotion - answer-B. stratified (based on price) (1) 2. Most real estate agents are primarily engaged in which area of activity A. residential property B. raw land and lots C. commercial property D. development - answer-A. residential property (1) 3. The IRS will treat real estate salespeople as independent contractors if 3 criteria are met. Which is not a criteria A. The salesperson's reimbursement is solely based on sales, not hours worked B. The salesperson represents himself as an independent contractor when dealing with third parties C. There is a written contract stating that the salesperson will be treated as an independent contractor for tax purposes D. The salesperson is licensed as a real estate agent - answer-B. The salesperson represents himself as an independent contractor when dealing with third parties ( merely representing oneself as an independent contractor would be a violation of disclosure requirements and is not considered to be an IRS criteria) (1) 4. A broker ordinarily would be liable to salespeople for A. unemployment compensation B. workers' compensation C. Social Security contributions D. none of these - answer-B. workers' compensation (for work related injuries) (1) 5. In choosing a broker, a new licensee should be LEAST interested in an office that A. has a high percentage of successful people B. has a good library of books, tapes, and videos for training C. offers 100% commission D. is a member of a local multiple listing service - answer-C. offers 100% commission (new licensees should remember training is more important than commission split) (1) 6. The BEST way to learn is to A. listen to what others say B. read instructional material C. watch what others do D. use the ideas you observe or read about - answer-D. use the ideas you observe or read about (by using ideas, they become yours) (1) 7. Which of the following statements is true about role-playing A. Role-playing situations are limited only by our own imagination B. Role-playing can be verbalized or nonverbalized C. Role-playing exercises can involve more than one person D. All of these - answer-D. All of these (1) 8. Which statement is an example of a specific goal A. I will work harder next week B. I will improve my listing presentation C. I will make 10 calls tomorrow on for-sale-by-owner ads and schedule three property showings by Sunday D. I will learn by observing successful agents - answer-C. I will make 10 calls tomorrow on for-sale-by-owner ads and schedule 3 property showings by Sunday ( exact goals are measurable ) (1) 9. All of the following will aid you in goal achievement EXCEPT A. that goals should be attainable B. that goals should be based on what you really want C. that goals should be kept to yourself because they are personal D. that goals should be exact so that you can measure their attainment - answer-C. that goals should be kept to yourself because they are personal (goals should be shared so you are accountable for making them. when no one knows the goals, it is easier to abandon them) (1) 10. Proper daily planning means that you should endeavor to A. reduce "D" Time activities B. increase "A" Time activities C. place more emphasis on probabilities than on possibilities D. accomplish all of these - answer-D. accomplish all of these (2) 1. Three brokers agreed that they would not let a fourth broker show any of their listings. This action would be regarded as A. a group boycott B. price-fixing C. market allocations D. a tie-in agreement - answer-A. a group boycott (2) 2. Ethics' relationship to law is that A. if an act is illegal it is also unethical B. ethics tend to precede the law C. ethics and the law both set minimum standards for behavior D. what is ethical is legal - answer-B. ethics tend to precede the law (2) 3. Which of the following phrases would be considered nondiscriminatory in an advertisement for a rental A. Christian family B. Prefer working married couple C. Just two blocks to St. Michael's D. None of these - answer-D. None of these (2) 4. A broker with a disabled employee widened the doorway to the restroom to accommodate a wheelchair. This work was performed to comply with A. Civil Rights Act of 1866 B. Americans with Disabilities Act C. Rumford Act D. Fair Housing Amendment Act of 1988 - answer-B. Americans with Disabilities Act (2) 5. The Civil Rights Act of 1866 specifically covers what type of discrimination A. Sex B. Marital status C. Age D. Race - answer-D. race (2) 6. A broker showed African American prospective buyers homes in African American and racially mixed neighborhoods. He would show African American prospects homes in predominantly Caucasian areas only if the prospects specifically requested to see homes in those areas. The broker's action would be described as A. illegal B. unethical C. steering D. all of these - answer-D. all of these (2) 7. A broker refused to show a young Hispanic family of five a condominium about which they had inquired. The broker's action would be proper if A. the broker considered the unit too small for the family B. there were no other children in the development C. the development has an age exemption because all occupants are 55 years of age or older D. 70% of the units are occupied by elderly - answer-C. the development has an age exemption because all occupants are 55 years of age or older (2) 8. A landlord can properly refuse to accept an applicant because the applicant A. has a guide dog and the apartment is on the fourth floor B. is a single but obviously pregnant woman C. appears to be gay and the landlord is afraid of catching AIDS D. None of these - answer-D. None of these (2) 9. The state act that specifically prohibits discrimination in business establishments is the A. Unruh Act B. Rumford Act C. Holden Act D. Civil Rights Act of 1968 - answer-A. Unruh Act (2) 10. Which of the following actions dealing in trust funds would be a violation of the law A. Giving trust funds received to a principal B. Placing depository trust funds directly into escrow C. Placing trust funds in a trust account D. Placing trust funds in the personal care of a bonded employee - answer-D. Placing trust funds in the personal care of a bonded employee (3) 1. Which of the following statements regarding an agent's duty in a real estate transaction is TRUE A. An agent has a fiduciary duty to the principal B. An agent must disclose any known detrimental information to a buyer, even when the agent represents the seller C. Any material facts the agent becomes aware of must be disclosed to the principal D. All of these - answer-D. All of these (3) 2. Which of the following statements regarding agency disclosure is TRUE A. An agent need not provide a seller of a commercial building with an agency disclosure B. The listing agent cannot elect to be only a buyer's agent C. Both of these are true D. Neither of these is true - answer-B. The listing agent cannot elect to be only a buyer's agent (3) 3. Which of the following statements regarding agency disclosure is TRUE A. The confirmation of agency must be in writing B. The three steps of the disclosure process are disclose, elect, confirm C. The selling agent must confirm the agency before the buyer makes an offer D. All of these are true - answer-D. All of these are true (3) 4. Which seller(s) must provide a Real Estate Transfer Disclosure Statement A. The seller of a lot B. The seller of a 4-unit apartment building C. The seller of a 16-unit apartment building D. All of these - answer-B. The seller of a 4-unit apartment building (3) 5. Under Easton, an agent's duty of inspection and disclosure covers A. all types of property B. accessible and inaccessible areas C. a visual inspection and known or should be known defects D. none of these - answer-C. a visual inspection and known or should be known defects (3) 6. Which statement regarding earthquake safety disclosure is TRUE A. It applies to 1-4 unit residential properties B. It applies only to homes built before 1930 C. The buyer can waive her right to a hazard report D. Delivery of a copy of The Homeowner's Guide to Earthquake Safety is evidenced by an affidavit from the agent - answer-A. It applies to 1-4 unit residential properties (3) 7. The buyers sign that they have received a booklet relating to A. environmental hazards B. floods, tornados, and earthquake C. foreclosure rights D. rescission rights - answer-A. environmental hazards (3) 8. Brownfields is a term related to