Chapter 1

Question 1

Broker

Answer 1

Person or company licensed to list, lease, buy, exchange, negotiate, or sell real property for others for compensation and who may be the agent of buyer, seller, or both

Question 2

Business Cycles

Answer 2

Upward and downward fluctuations in business activity

Question 3

Chattel

Answer 3

An item of movable personal property

Question 4

Demand

Answer 4

The amount of goods people are willing and able to buy at a given price; often coupled with supply

Question 5

Heterogeneity

Answer 5

A lack of uniformity; dissimilarity; heterogeneity. Because no two parcels of land are exactly alike, real estate is said to be nonhomogeneic

Question 6

Highest and Best Use

Answer 6

The use that will give the owners the greatest actual return on their investment.

Question 7

Land

Answer 7

The earth’s surface extending downward to the center of the earth and upward to infinity, including things permanently attached by nature, such as trees and water

Question 8

Market

Answer 8

Place where goods are bought and sold, where value for those goods is established, and where it is advantageous for buyers and sellers to trade.

Function of the market is to facilitate this exchange by providing a setting in which the supply and demand forces of the economy can establish market value.

Real estate market is a free market and is local in nature.

Question 9

Nonhomogeneity

Answer 9

A lack of uniformity; dissimilarity; heterogeneity. Because no two parcels of land are exactly alike, real estate is said to be nonhomogeneic

Question 10

Personal Property

Answer 10

All property that does not fit the definition of real property

Primary characteristic of personal property is movability. Items of personal property, also referred to as chattels, include such tangibles as furniture, clothing, money, bonds, and bank accounts

Question 11

Personalty

Answer 11

Items that do not fit into definition of real property.

AKA: Chattel

Question 12

Provisional Broker

Answer 12

Real estate licensee who performs real estate activities under the supervision of a licensed real estate broker-in-charge. Must complete post-licensing courses to remove the provisional license status

Question 13

Real Estate

Answer 13

Realty, is defined as land at, above, and below the earth’s surface, including all things permanently attached to it, whether natural or artificial.

The term real estate is therefore somewhat broader than the term land and includes not only the physical components of the land provided by nature but also all human-made permanent improvements on and to the land.

Question 14

Real Property

Answer 14

The land, everything that is permanently attached to the land, and everything that is appurtenant to (or goes with) the land

Land itself, the improvements thereon, and the interests, benefits, and rights inherent in the ownership of real estate

Question 15

Situs

Answer 15

The personal preference of people for one location over another, not necessarily based on objective facts and knowledge

Question 16

Supply

Answer 16

The amount of goods available in the market to be sold at a given price. The term is often coupled with demand