Chapter 10

Question 1

A tangible or intangible benefit of real property that enhances its attractiveness or increases the satisfaction of the user.

Answer 1

Amenity

Question 2

Amenities generally accrue to

Answer 2

home ownership

Question 3

value is composed of two components

Answer 3

a return ON investment and a return OF investment.

Question 4

To compensate for a higher risk

Answer 4

investors demand a higher return

Question 5

Real estate offers potentially ____returns, with above average safety of investment, but only ______liquidity.

Answer 5

high, fair

Question 6

a commodity that is bought and sold on the market, just as is lumber, shares of stock or real estate.

Answer 6

Money

Question 7

The Federal Reserve’s efforts to influence the level of economic activity by regulating the availability of money and the rate of interest

Answer 7

Monetary Policy

Question 8

The interaction of buyers and sellers who trade short-term money instruments.

Answer 8

Money Market

Question 9

The interaction of buyers and sellers trading long- or intermediate-term money instruments. Longer than one year. Included mortgages, bonds and stocks

Answer 9

Capital Market

Question 10

Which type of purchaser is more likely to pay more attention to the amenities of a property, such as a pool, a horse stable, or a nice view?

Answer 10

Owner occupant buyer

Question 11

When was the Fed founded?

Answer 11

1913

Question 12

The Federal Reserve consists of ____ regional banks

Answer 12

12

Question 13

Who owns the Fed?

Answer 13

No one, it is independent

Question 14

To whom is the Fed accountable?

Answer 14

Congress

Question 15

Where are short-term money instruments bought and sold?

Answer 15

Money markt

Question 16

As part of its monetary policy, the Fed can influence both the _______ of money and the _______ of money.

Answer 16

Supply, cost

Question 17

The “price” of money is expressed as

Answer 17

interest rate

Question 18

The interest rate that is charged by the Fed when lending money to banks is called the _______ rate.

Answer 18

discount

Question 19

Which of the following typically incurs the highest burden of management?

savings account
money market
certificate of deposit
real estate

Answer 19

real estate

Question 20

The return ON investment is usually accomplished through

Answer 20

interest payments

Question 21

The Federal Reserve Board consists of ____ members.

Answer 21

7

Question 22

The FDIC insures deposits up to $______________.

Answer 22

250,000

Question 23

Money market is defined as the interaction of buyers and sellers who trade

Answer 23

short term instruments

Question 24

Who appoints members to the Federal Reserve Board?

Answer 24

President of US

Question 25

True or False? Stocks are considered a good investment because the return OF your investment is guaranteed.

Answer 25

False

Question 26

Which type of purchaser is more likely to pay more attention to the amenities of a property, such as a pool, a horse stable, or a nice view? - owner-occupant buyer - investor - both an owner-occupant and an investor would look at a property exactly the same

Answer 26

both an owner-occupant and an investor would look at a property exactly the same

Question 27

You are an investor who owns a parcel of real property. You want to cash out your investment, and it takes you a year to market your property and close the sale. What investment factor does this demonstrate? - favorable tax treatment - safety - liquidity - easement

Answer 27

Liquidity

Question 28

True or False? Money is a commodity that is bought and sold on the market.

Answer 28

True

Question 29

The Fed consists of ______ regional banks.

Answer 29

12

Question 30

To compensate for a higher risk, investors demand a higher return lower return hedge security deposit

Answer 30

higher return

Question 31

The interest rate that is charged by the Fed when lending money to banks is called the _______ rate. bank discount prime bank-to-bank

Answer 31

discount

Question 32

Which of the following typically incurs the highest burden of management? savings account money market certificate of deposit real estate

Answer 32

Real Estate

Question 33

The Federal Reserve Board consists of ____ members.

Answer 33

7

Question 34

The “price” of money is its yield an interest rate change its discount rate

Answer 34

An Interest rate

Question 35

To whom is the Fed accountable? Congress No one The President The Treasury Department

Answer 35

Congress

Question 36

Who appoints members to the Federal Reserve Board? they are elected by public vote the Secretary of the Treasury the FRB chairperson the President of the U.S.

Answer 36

The president of the US`

Question 37

The supply of money in the U.S. is regulated by Congress the Treasury Department the Fed the President

Answer 37

the Fed