CHAMPIONS REAL ESTATE AGENCY ACTUAL EXAM 2025|200 QUESTIONS WITH
ACCURATE SOLUTIONS
1. Implied agency is created by:
Action.
Contract.
State law.
Federal law.
2. What is the definition of a fiduciary relationship in the context of
real estate?
A relationship based on competition between agents
A relationship based on trust between a broker and a principal
A relationship solely focused on financial
transactions A relationship that does not require
legal obligations
3. What is the definition of physical deterioration in the context of real
estate appraisal?
Depreciation due to market fluctuations
Depreciation due to ordinary wear and
tear Depreciation due to changes in
zoning laws Depreciation due to
environmental factors
4. What is the definition of deferred maintenance in the context of
real estate?
Regular upkeep of property to maintain value
Postponed maintenance on property that results in increased
,physical depreciation
Immediate repairs required for property safety
, Maintenance performed to enhance property aesthetics
5. What is the definition of a dual agent in real estate?
A broker who represents only the buyer in a transaction
A broker who represents only the seller in a transaction
A broker who has the written permission of both the buyer and
the seller to represent both parties in a single transaction
A broker who acts as a mediator without representing either party
6. Explain the significance of the Principle of Increasing and Decreasing
Returns in real estate investment decisions.
It emphasizes the importance of investing in properties with high
rental yields.
It highlights the need to stop investing when returns diminish,
preventing over-improvement.
It suggests that all investments should be made based on market
trends.
It indicates that property values will always increase over time.
7. Explain how the concept of 'cost' differs from 'market value' in real
estate appraisal.
Cost refers to past expenditures, while market value reflects
current market conditions.
Cost is always higher than market value.
Cost is determined by the seller, while market value is determined
by the buyer.
Cost includes only construction expenses, while market value
includes all property features.
, 8. In the context of agency relationships in real estate, explain the role of
a principal and how it differs from that of an agent.
The principal is the broker who represents the client in transactions.
The principal is the party who hires the broker to act on their
behalf, while the agent is the broker who represents
them.
The principal is responsible for all legal obligations in a transaction,
while the agent has no responsibilities.
The principal is the buyer in a real estate transaction, while the
agent is the seller.
9. Explain the relationship between price and market value in real
estate transactions.
Price is always higher than market value.
Price is determined solely by the seller's expectations.
Price typically reflects the market value of a property.
Price and market value are unrelated concepts.
10. What is the Principle of Change in the context of real estate appraisal?
Appraisers must consider the physical condition of the property.
Appraisers must make adjustments for changes in market
conditions and time.
Appraisers should only focus on the original purchase price.
Appraisers must ignore external economic factors.
11. Explain why a void contract is considered invalid in the context of
real estate transactions.
It can be enforced in court
It contains all necessary elements but is not signed
It lacks one or more essential elements required for validity
ACCURATE SOLUTIONS
1. Implied agency is created by:
Action.
Contract.
State law.
Federal law.
2. What is the definition of a fiduciary relationship in the context of
real estate?
A relationship based on competition between agents
A relationship based on trust between a broker and a principal
A relationship solely focused on financial
transactions A relationship that does not require
legal obligations
3. What is the definition of physical deterioration in the context of real
estate appraisal?
Depreciation due to market fluctuations
Depreciation due to ordinary wear and
tear Depreciation due to changes in
zoning laws Depreciation due to
environmental factors
4. What is the definition of deferred maintenance in the context of
real estate?
Regular upkeep of property to maintain value
Postponed maintenance on property that results in increased
,physical depreciation
Immediate repairs required for property safety
, Maintenance performed to enhance property aesthetics
5. What is the definition of a dual agent in real estate?
A broker who represents only the buyer in a transaction
A broker who represents only the seller in a transaction
A broker who has the written permission of both the buyer and
the seller to represent both parties in a single transaction
A broker who acts as a mediator without representing either party
6. Explain the significance of the Principle of Increasing and Decreasing
Returns in real estate investment decisions.
It emphasizes the importance of investing in properties with high
rental yields.
It highlights the need to stop investing when returns diminish,
preventing over-improvement.
It suggests that all investments should be made based on market
trends.
It indicates that property values will always increase over time.
7. Explain how the concept of 'cost' differs from 'market value' in real
estate appraisal.
Cost refers to past expenditures, while market value reflects
current market conditions.
Cost is always higher than market value.
Cost is determined by the seller, while market value is determined
by the buyer.
Cost includes only construction expenses, while market value
includes all property features.
, 8. In the context of agency relationships in real estate, explain the role of
a principal and how it differs from that of an agent.
The principal is the broker who represents the client in transactions.
The principal is the party who hires the broker to act on their
behalf, while the agent is the broker who represents
them.
The principal is responsible for all legal obligations in a transaction,
while the agent has no responsibilities.
The principal is the buyer in a real estate transaction, while the
agent is the seller.
9. Explain the relationship between price and market value in real
estate transactions.
Price is always higher than market value.
Price is determined solely by the seller's expectations.
Price typically reflects the market value of a property.
Price and market value are unrelated concepts.
10. What is the Principle of Change in the context of real estate appraisal?
Appraisers must consider the physical condition of the property.
Appraisers must make adjustments for changes in market
conditions and time.
Appraisers should only focus on the original purchase price.
Appraisers must ignore external economic factors.
11. Explain why a void contract is considered invalid in the context of
real estate transactions.
It can be enforced in court
It contains all necessary elements but is not signed
It lacks one or more essential elements required for validity
