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Marketing SAE Flashcards

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1
Q
  1. What is the main goal of niche marketing?
    A. To sell to every available market segment
    B. To appeal to an entire market with one message
    C. To satisfy the needs of a narrowly defined customer group
    D. To reduce production costs through volume
A

✅ Correct: C
Explanation: Niche marketing focuses on specific customer needs within a small market segment.

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2
Q
  1. Which of the following best describes mass marketing?
    A. Focused, targeted, and high-cost
    B. Broad, general, and aimed at high-volume sales
    C. Based on influencer endorsements
    D. Personalized strategies for individual buyers
A

✅ Correct: B
Explanation: Mass marketing aims to reach as many people as possible using broad strategies.

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3
Q
  1. What is the primary benefit of relationship marketing?
    A. Higher profit per transaction
    B. Faster property sales
    C. Long-term trust and customer retention
    D. Increased digital advertising
A

✅ Correct: C
Explanation: Relationship marketing is about maintaining long-term client relationships based on trust.

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4
Q
  1. According to Kotler’s idea, maintaining an existing customer is how many times cheaper than acquiring a new one?
    A. 2
    B. 3
    C. 5
    D. 10
A

✅ Correct: C
Explanation: It’s about 5 times cheaper to retain a customer than to acquire a new one.

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5
Q
  1. Which “P” in the marketing mix is about the distribution and accessibility of your service?
    A. Product
    B. Price
    C. Place
    D. Promotion
A

✅ Correct: C
Explanation: “Place” refers to how and where a product is made available to consumers

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6
Q
  1. Which of the following is NOT part of the original 4 Ps of the marketing mix?
    A. Product
    B. Price
    C. People
    D. Promotion
A

C
Explanation: “People” is often added later, but the original 4 Ps are Product, Price, Place, and Promotion.

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7
Q
  1. What is a key reason real estate agents must understand digital marketing?
    A. To comply with TREC rules
    B. Most client connections begin online
    C. It guarantees property sales
    D. It is legally required in Texas
A

B

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8
Q
  1. What term describes friends, family, and acquaintances who may refer you real estate clients?
    A. Mass audience
    B. Strategic group
    C. Sphere of influence
    D. Core segment
A

C

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9
Q
  1. Strategic planning differs from traditional planning mainly in:
    A. Its focus on one-time sales
    B. The use of cold calls
    C. Its methodical, resource-focused structure
    D. Its informal and reactive approach
A

✅ Correct: C
Explanation: Strategic planning is a structured approach focused on aligning business resources with goals.

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10
Q
  1. Which viewpoint is NOT part of the four used to form business strategy?
    A. Project view
    B. Marketplace view
    C. Personal view
    D. Environmental view
A

✅ Correct: C
Explanation: “Personal view” is not one of the strategic planning viewpoints mentioned.

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11
Q
  1. What does the product development stage require?
    A. Hiring influencers
    B. Determining the product price
    C. Researching the product life cycle
    D. Designing business cards
A

✅ Correct: C
Explanation: The product development stage includes studying how the product will grow, mature, and decline.

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12
Q
  1. What defines the “promotion” part of the marketing mix?
    A. Setting pricing models
    B. Defining distribution channels
    C. Communicating with customers about the product
    D. Researching the life cycle of a product
A

✅ Correct: C
Explanation: Promotion is about how you communicate your offer to the market.

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13
Q
  1. A real estate agent’s “product” in niche marketing is primarily:
    A. The houses
    B. Their brokerage
    C. The MLS platform
    D. Themselves
A

✅ Correct: D
Explanation: In real estate, you—the agent—are the product being marketed.

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14
Q
  1. One key reason small businesses choose niche marketing is:
    A. They want to reach the largest audience
    B. They have massive advertising budgets
    C. It allows focus with limited resources
    D. It eliminates the need for social media
A

✅ Correct: C
Explanation: Niche marketing helps small businesses compete by focusing their limited resources.

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15
Q
  1. Why is it important to write down your niche marketing plan?
    A. TREC requires it
    B. It helps you qualify for tax deductions
    C. To identify problems before wasting time or money
    D. So your broker can approve it
A

✅ Correct: C
Explanation: Putting your plan on paper allows you to make adjustments before real-world mistakes.

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16
Q
  1. Which element of promotion involves unpaid communication?
    A. Social media ads
    B. Press releases and sponsorships
    C. Billboard marketing
    D. Email campaigns
A

✅ Correct: B
Explanation: Public relations like press releases are unpaid promotional tools.

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17
Q
  1. What is the biggest factor that influences pricing strategy in marketing?
    A. The MLS ranking
    B. Seller’s mood
    C. Customer value perception
    D. Real estate school ranking
A

✅ Correct: C
Explanation: Price should reflect how much value the customer places on the product or service.

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18
Q
  1. According to Microsoft studies, what is the average human attention span in seconds?
    A. 5
    B. 6
    C. 7
    D. 9
A

C

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19
Q
  1. What is the primary purpose of strategic thinking in business?
    A. To create viral content
    B. To view business problems from a broader perspective
    C. To reduce taxes
    D. To comply with federal law
A

B

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20
Q
  1. What makes social media a powerful tool for real estate marketing today?
    A. It guarantees property value increases
    B. Most buyer-seller interactions begin online
    C. It’s required by most brokers
    D. It’s less expensive than yard signs
A

✅ Correct: B
Explanation: Social media is now the starting point for most real estate client relationships.

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21
Q

Which tactic involves casting doubt on competitors to make your offering look better?
A. Promoting exclusivity
B. Repositioning your brand
C. ✅ Using FUD (fear, uncertainty, and doubt)
D. Branding with logos

A

C

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22
Q

. What causes peaks and valleys in a real estate agent’s business cycle?
A. Inconsistent pricing strategy
B. Switching brokerages
C. ✅ Focusing on managing deals instead of prospecting
D. Too many open houses

A

C / Explanation: Agents often stop prospecting when they’re busy closing deals, which leads to future dry spells.

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23
Q

What is the most important generational group to target in modern real estate marketing?
A. Gen X
B. Boomers
C. ✅ Millennials
D. Silent Generation

A

C

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24
Q

Which of these is a key part of a service plan?
A. Your personal vacation schedule
B. Home pricing guide
C. Marketing strategy and follow-up methods
D. List of local real estate schools

A

Explanation: A service plan must outline how you communicate, market, and follow up with clients.

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25
What’s a common buyer type based on motivations? A. Investor-flippers B. Out-of-state gamblers C. Buyers trading up or down D. Contractors only
C /Explanation: Many clients are motivated by life transitions—upsizing, downsizing, or relocating.
26
What should a marketing plan include beyond just advertising? A. Your salary requirements B. How you will market to cooperating brokers and buyers C. Legal disclaimers D. A full biography
B / Explanation: The plan must address broader strategy—beyond ads—to include outreach and networking.
27
What is a major advantage small businesses have over big competitors like Walmart? A. Cheaper prices B. More products C. Personal service and unique offerings D. Higher budgets
C / Explanation: Smaller businesses can focus on connection and customization—something large chains can’t do.
28
. What was a major driver in the shift from traditional marketing to niche marketing? A. Lack of products in the market B. Mass production of real estate listings C. Advances in information technology D. Increase in global investors
✅ Correct: C Explanation: Technology enabled better data collection and analysis, allowing for more targeted strategies like niche marketing.
29
Strategic planning focuses on which of the following? A. Discounting B. Product bundling C. Effective use of business resources D. Rebranding campaigns
Explanation: Strategic planning organizes goals, resources, and implementation.
30
. What is an example of strategy implementation? A. Writing a mission statement B. Hiring a business coach C. Facilitating communication within the team D. Choosing a niche
✅ Correct: C Explanation: Implementation focuses on how plans are executed, such as improving internal processes.
31
which of the following is not a strategic viewpoint mentioned? A. Marketplace view B. Environmental view C. Economic downturn view D. Measurement view
✅ Correct: C Explanation: The four views are environmental, marketplace, project, and measurement.
32
What are the 4 Ps in the marketing mix? A. Product, placement, promotion, population B. Price, policy, planning, promotion C. Product, price, place, promotion D. Profit, platform, process, people
✅ Correct: C Explanation: The classic 4 Ps are product, price, place, and promotion.
33
What defines the 'product' in real estate marketing? A. Your sales pitch B. The actual listing or service you offer C. Your brokerage firm D. A financing plan
✅ Correct: B Explanation: The product is what meets the customer’s need, like a property or service.
34
During product development, what should be considered? A. National inflation B. How to disguise flaws C. Competitor’s product differences D. Property tax calculations
✅ Correct: C Explanation: Understanding competitors helps differentiate your offering
35
hat makes pricing a strategic factor in the 4 Ps? A. It depends on zip code B. It’s not important in real estate C. It affects demand and comparisons D. It is only relevant for luxury homes
✅ Correct: C Explanation: Price plays a key role in consumer decision-making and business revenue.
36
Which metric should an agent track to evaluate a marketing campaign's effectiveness? A. Broker’s commission split B. Brokerage size C. Response rate and cost-per-lead D. Amount of cold calls made
c /Agents should track responses and return on investment to improve or change marketing strategy.
37
What is the primary benefit of using email and online tools in real estate marketing? A. It replaces face-to-face meetings entirely B. It creates a digital-only client base C. It speeds up initial contact with clients D. It reduces the need for any client interaction
c/ Explanation: The speed of response is a major advantage of digital tools. Prompt replies increase trust and engagement with potential clients
38
What is the 'Rule of Seven' in marketing? A. You need 7 clients per week to stay profitable B. You should post 7 listings per platform C. Consumers must see a message ~7 times before acting D. You should send emails 7 days in a row
Answer: C. Consumers must see a message ~7 times before acting Explanation: Repetition builds recognition and increases the likelihood of action from the prospect.
39
What does IDEA stand for in customer service problem solving? A. Inform, Design, Execute, Analyze B. Identify, Diagnose, Explore, Act C. Instruct, Deliver, Evaluate, Apply D. Investigate, Define, Engage, Apply Answer: B. Identify, Diagnose, Explore, Act
B
40
. Why is gap analysis important in improving real estate websites? A. It shows you how to get more listings B. It compares what clients expect vs. what they receive C. It ranks your website on Google D. It identifies the best social media channels
B. It compares what clients expect vs. what they receive Explanation: Understanding the difference between expectations and delivery helps target areas for improvement.
41
What’s a key reason agents should know who their customers are before building a site? A. To include flashy graphics B. To use advanced coding languages C. To align the content with customer needs D. To showcase as many listings as possible
c
42
What is a real risk of overpromising pricing to a web-savvy buyer? A. They will always pay more B. They will share false info online C. They will fact-check and lose trust D. They will file a TREC complaint immediately
Answer: C. They will fact-check and lose trust Explanation: Today’s buyers often research thoroughly and may challenge misleading claims.
43
Why is it important for agents to share blog posts or helpful links with clients? A. It adds SEO value to their site B. It fills up their newsletter space C. It builds authority and educates the client D. It avoids the need for phone calls
C
44
What is the main reason visual content is shared more often on social media? A. It uses less data B. It’s faster to read C. It holds attention better than text D. Algorithms rank it higher
Answer: C Explanation: Visual content like images and infographics are 40 times more likely to be shared because people process visuals faster and remember them better.
45
. What is the potential impact of a website taking more than 3 seconds to load? A. Nothing, users expect delays B. 10% of users will reload the page C. Up to 40% of users may leave D. Google may ban the site
c
46
What best describes the difference between the Internet and the World Wide Web? A. They’re the same, just different names B. The Internet hosts the Web C. The Web is hardware; the Internet is software D. The Web is older than the Internet
B/ Explanation: The Internet is the global network infrastructure, while the Web is a system of pages accessed via browsers running over that infrastructure.
47
Why did the Austin Board of Realtors stop sharing listings with syndication sites like Zillow in 2014? A. Syndication sites had poor SEO B. Syndication sites violated fair housing laws C. Syndication sites weren’t bound by the Code of Ethics D. Syndication sites were competing for commissions
Answer: C Explanation: ABOR ended syndication because non-Realtor sites weren’t bound by ethical standards, increasing the risk of inaccurate info and liability.
48
What is a “listing portal”? A. A site where brokers sign listing contracts B. A platform where agents buy advertising C. A consumer-facing website showing listings D. An MLS database used by agents only
Answer: C Explanation: Listing portals like Zillow or Realtor.com are public websites showing property listings pulled from MLS or agents.
49
What is a potential risk of posting listings on syndication sites? A. Automatic suspension of the listing B. Viral exposure of agent contact info C. Legal responsibility for inaccurate third-party info D. Clients bypassing the agent
Answer: C Explanation: Even if a site like Trulia posts incorrect data, the agent is still legally responsible for ensuring accuracy.
50
What device was most commonly planned for future purchase by agents, according to NAR? A. Digital camera B. Desktop computer C. iPad D. Smartwatch
Answer: C Explanation: Agents prioritized tablets (like iPads) for mobile presentations and work flexibility.
51
. What is the primary advantage of using Pay Per Click (PPC) advertising for real estate websites? A. You pay only when someone visits your site B. Your ad always appears at the top of the search results C. You pay a flat monthly fee for visibility D. Your website appears on every search engine
Answer: A Explanation: In PPC, you pay only when someone actually clicks your ad, not for simply displaying it.
52
What’s a common mistake when selecting keywords for PPC advertising? A. Using too many hyphens B. Choosing generic terms like "condos" C. Bidding too low initially D. Targeting only mobile users
Answer: B Explanation: Generic terms like "condos" lead to untargeted traffic. It's better to use specific keywords like “new condo sales Arlington.”
53
Why is regionalizing your PPC keywords recommended? A. It helps with global search optimization B. It prevents the site from showing up in Google Ads C. It increases cost per click D. It targets only relevant local customers
D /Answer: D Explanation: Using geographic keywords like “Richmond real estate agent” targets buyers in your actual market area.
54
Why is it risky to label yourself in ad copy as “the best REALTOR®”? A. It's considered false advertising by NAR B. It increases PPC costs C. It's not allowed by ad platforms D. Customers prefer humble language
Answer: C Explanation: Platforms like Google restrict superlative claims like “best” in PPC ads to prevent misleading advertising.
55
What is one drawback of requiring users to register before viewing MLS listings on your website? A. It reduces site traffic and engagement B. It improves lead quality C. It increases conversion rates D. It boosts SEO rankings
Answer: A Explanation: Many users prefer instant access and will avoid websites that require registration, reducing overall traffic.
56
How often should you check the placement of your PPC ad? A. Daily B. Once a month C. Never—set it and forget it D. Once or twice per week
D
57
Which of the following is allowed in PPC ad copy? A. “Lowest rates in Texas!” B. “Top 1% REALTOR® in the U.S.” C. “We are the most affordable!” D. “Courses available 24/7. Study anytime.”
Answer: D Explanation: Specific, factual statements like “Courses available 24/7” are permitted, unlike superlative or unverifiable claims.
58
What is a key benefit of using MLS data on your website? A. It blocks competitors from accessing listings B. It creates artificial scarcity C. It gives consumers access to accurate and comprehensive listings D. It increases your commission percentage
Answer: C Explanation: MLS integration helps build trust and provides valuable, up-to-date listing information directly to consumers.
59
What communication behavior builds trust with clients online? A. Sending automated emails only B. Responding to emails within 24 hours C. Avoiding phone calls D. Using vague responses to save time
Answer: B Explanation: Responding promptly and personally shows professionalism and helps build rapport with clients.
60
What is one major usability issue that discourages users from engaging with a real estate website? A. A bold company slogan B. Listing prices without tax C. Requiring users to register before browsing D. A simple design
C
61
What is the recommended minimum number of contacts for a functioning real estate database? A. 50 B. 100 C. 200 D. 1,000
C
62
Which of the following is a common mistake that causes loss of potential client relationships? A. Overusing email follow-ups B. Storing client info on scraps of paper C. Advertising on low-budget TV D. Sending postcards instead of email
Answer: B Explanation: Poor organization of contact data, such as handwritten notes, leads to missed follow-ups and lost leads.
63
Why is satellite television a useful real estate marketing tool? A. It has the highest viewership across all demographics B. It allows for live property tours C. It enables property tours to be shown with images and voice-over D. It can only be accessed by local clients
Answer: C Explanation: Satellite real estate channels allow agents to create slideshow-like property tours with narration and music.
64
Why should you avoid long or complex URLs for your real estate website? A. They can get blocked by search engines B. They reduce SEO ranking C. They’re harder for customers to remember D. They cost more money to register
Answer: C Explanation: Simpler URLs are easier to recall and type, improving access and traffic.
65
. Why is it important to avoid "bells and whistles" on a website if your audience uses dial-up internet? A. It makes your site more secure B. It improves compatibility with mobile apps C. It shortens loading time for users with slower connections D. It boosts email deliverability
Answer: C Explanation: Overly graphic-heavy sites load slowly on dial-up and cause users to abandon the page.
66
What is the first step in the IDEA problem-solving process for web development or customer service issues? A. Explore for solutions B. Diagnose the cause C. Act on the best idea D. Identify the problem
Answer: D Explanation: The process starts with identifying the problem, often through a gap analysis.
67
What is one action that builds long-term client relationships according to the 'Nine Steps' method? A. Offer discounts after every sale B. Prioritize financials over feedback C. Establish customer-driven contact systems D. Automate all interactions
Answer: C Explanation: Customized contact management helps maintain and improve client relationships.
68
Why do consumers prefer real estate websites that integrate MLS data without requiring registration? A. They want to verify the agent’s license B. They don’t want their searches tracked C. They expect instant access without giving up personal info D. They believe it’s more secure
Answer: C Explanation: Registration walls push users away. Ease of access improves site retention.
69
What’s a key reason experienced agents maintain large client databases? A. To comply with state licensing laws B. To automate closings C. For long-term referrals and repeat business D. To track office expenses
Answer: C Explanation: A well-maintained database supports ongoing communication, leading to more referrals and repeat clients.
70
Which of the following is a smart short-term marketing tool mentioned in the content? A. Print-only flyers B. Billboard advertising C. CD-ROM or DVD property tours D. Real estate auctions
Answer: C Explanation: CD/DVD tours are low-cost tools for showcasing properties with music and narration.
71
What role does feedback play in real estate website development? A. It slows down decision-making B. It’s mostly for public testimonials C. It helps agents remove unnecessary features and improve user experience D. It is only relevant during open houses
Answer: C Explanation: Customer feedback identifies what works and what doesn’t, making your site more effective.
72
1. What is the main risk of failing to maintain updated contact information in your real estate database? A. Losing access to CRM tools B. Violating state advertising regulations C. Wasting resources and weakening client relationships D. Receiving fewer online reviews
C – If your data is outdated, you lose time, money, and possibly the client’s trust.
73
Why should contact details be entered in separate columns in a spreadsheet when designing your system? A. So the database prints correctly B. So the data syncs with smartphones C. So you can sort and filter the information D. So you can upload them to your email inbox
C – Separate columns allow you to filter/sort data easily for targeted follow-ups.
74
What’s the key difference between a warm lead and a cold lead? A. Cold leads ask more questions B. Warm leads require no follow-up C. Warm leads are closer to a decision D. Cold leads are unwilling to give referrals
Warm leads are actively thinking about moving; cold leads are not.
75
. Which of the following would best classify a lead as "hot"? A. A client who inquired about mortgage rates B. A buyer who attends every open house C. A person relocating for work within 30 days D. A seller who left a voicemail last week
A work-related move often creates urgent real estate needs = hot lead.
76
What is the most likely reason George’s follow-up with clients is more effective than Beth’s? A. He has a wider social circle B. He only works with hot leads C. He uses a structured, searchable database D. He sends handwritten letters more often
C – George’s organized system lets him stay consistent and top-of-mind.
77
Which of the following best describes the IDEA process in customer service? A. Inspire, Deliver, Execute, Analyze B. Identify, Diagnose, Explore, Act C. Integrate, Direct, Evaluate, Acknowledge D. Initiate, Design, Engage, Audit
B
78
What is a common misstep many agents make when designing websites? A. Using too many hyperlinks B. Forgetting to include graphics C. Requiring user registration before browsing D. Including their license number too many times
C – Making users register before browsing turns people away quickly.
79
Which best explains why flashy websites may hurt lead generation? A. They use too much legal jargon B. They take too long to load and distract from purpose C. They reduce email click-through rates D. They require too many embedded scripts
B – Fancy sites that lag will drive visitors away before content is seen.
80
Which customer service tactic is most likely to help retain clients long-term? A. Keeping your email signature minimal B. Providing a handwritten note once per year C. Offering timely, consistent, multi-channel communication D. Avoiding marketing contact after a closing
C – Frequency, speed, and multi-channel options keep people engaged.
81
Why is it recommended to keep a minimum of 200 people in your real estate database? A. It meets MLS marketing minimums B. It allows for easier automation with software C. It improves ranking in Google search D. It increases referral potential and business flow
D – More contacts = more referrals. Seasoned pros build databases into the thousands.
82
Which phrase best captures the goal of the "Customer Champion" concept? A. Enforce company policies at all costs B. Think like the customer during decision-making C. Reduce client complaints using checklists D. Create viral social media campaigns
B
83
What is a preventative cost in a real estate customer service strategy? A. Cost of express mailing closing docs B. Cost of redoing a flawed contract C. Cost of updating website speed and clarity D. Cost of answering client complaints by phone
C – Website and system improvements are examples of preventative spending.
84
What does the "Rule of Seven" suggest about marketing? A. Only 7% of viewers become leads B. The consumer needs to see your name 7 times to act C. 7 leads out of 10 become clients D. You should call each lead at least 7 times
B – Rule of Seven = consumer action usually happens after 7 exposures.
85
Why is Pinterest considered especially effective for driving traffic to real estate websites? A. It prioritizes paid advertising above organic content B. Users must complete a form before viewing external sites C. Its platform is designed to link users directly to external websites D. Real estate listings are ranked highest in Pinterest's algorithm
C – Pinterest is designed to send users directly to external sites, unlike many platforms.
86
What is the principle behind Pinterest’s marketing effectiveness? A. “Show to sell” B. “Pin to win” C. “Get to give” D. “Give to get”
D – “Give to get” is the foundational approach used to build trust and traffic.
87
What tool was mentioned as free software that helps with heat maps, lead capture, and sharing? A. Canva B. HubSpot C. Somme D. ClickFunnels
C – SumoMe helps with heat maps, lead capture, and share tracking.
88
Which social media strategy is specifically recommended when targeting affluent consumers? A. Use memes for relatability B. Share political opinions to establish authority C. Use high-quality visuals and lifestyle content D. Minimize branding to seem more personal
Affluent clients respond to quality imagery and lifestyle-focused content.
89
Why does Facebook's custom audience matching only return partial results when uploading email lists? A. Many emails bounce due to spam detection B. Email addresses might not match user Facebook accounts C. Facebook doesn’t allow custom list uploads anymore D. Matching requires payment
B
90
What social media channel is ideal for real-time tips and mobile communication? A. Pinterest B. LinkedIn C. YouTube D. Twitter
D
91
What is a strategic way to boost exposure through local networks using Facebook? A. Send automated messages to random users B. Share your vendor list and tag their accounts C. Block competitors from accessing your posts D. Hide content behind login walls
B
92
How does Facebook “hash” data to preserve privacy? A. By deleting all user records before matching B. Through a process that scrambles data so it can’t be decrypted C. By converting data to QR codes D. By masking data behind Facebook firewall
B – Hashing produces a non-reversible fingerprint of data for secure comparison.
93
What is the main advantage of social media for affluent real estate consumers? A. More access to virtual staging B. Access to properties before they're listed C. Targeted, relevant information with minimal wasted content D. More frequent flyer discounts on real estate purchases
C
94
. What phrase best summarizes the shift in power brought by social media to consumers? A. “Content is king” B. “The medium is the message” C. “You’re not the customer; you’re the product being sold” D. “Engagement drives conversions”
C
95
What caused Instagram to reverse a controversial change to its Terms of Use? A. Legal threat from Facebook B. Internal privacy audit C. Public backlash and negative media attention D. FTC violation notice
C
96
What does CapGemini suggest is the first step in creating an effective social media strategy? A. Grow your network B. Be findable C. Engage using direct messages D. Use only paid ads
“Be findable” is listed as the first principle in CapGemini’s strategy.
97
What is the role of “listening” in a firm’s social media strategy? A. To avoid posting duplicate content B. To help automate scheduling C. To respond to competitors' pricing D. To detect client life changes and brand opportunities
D – Listening means identifying events in a client’s life to time outreach.
98
How can Instagram be used most effectively in real estate marketing? A. Posting long-form text content regularly B. Highlighting discounts and coupons C. Uploading high-resolution, visually engaging photos D. Avoiding hashtags to maintain brand focus
C – Instagram is visual-first; image quality drives engagement
99
Which tactic helps reinforce client trust and brand credibility on a Facebook real estate page? A. Using anonymous reviews only B. Posting only promotional listings C. Publicly thanking clients for recent transactions D. Creating memes and GIFs for daily posts
C – Public appreciation boosts credibility and relatability.
100
What is the core idea behind the “give to get” strategy used on Pinterest? A. Offer home tours in exchange for contact details B. Create video tutorials to generate paid subscriptions C. Share useful content freely to gain attention and trust D. Trade property listings with other agents
Give to get" means you offer valuable content first, and in return, earn trust and engagement.
101
Which social media platform allows businesses to create a “custom audience” by uploading an email list? A. Pinterest B. Facebook C. LinkedIn D. Twitter
Facebook matches uploaded email lists with active users to create targeted ad audiences.
102
What is the average length a listing video should be, according to Inman.com? A. 30–45 seconds B. Under 2 minutes C. 60–90 seconds D. 2–3 minutes
C/ nman recommends a 1–1.5 minute duration for optimal engagement.
103
What tool can automate lead capture and provide heat maps of website activity? A. Canva B. Zapier C. SumoMe D. Google Docs
C: SumoMe offers free tools to capture emails, track clicks, and analyze behavior.
104
Which generation is most likely to respond to texting and social media rather than email or calls? A. Silent Generation B. Generation X C. Baby Boomers D. Millennials
D : Explanation: Millennials prefer text and social media for quick, non-invasive communication.
105
What video content should you use to build emotional connection and share your personality with leads? A. Listing videos B. About Me videos C. Livestreams D. “How-To” videos
"About Me" videos humanize the agent and foster early trust.
106
Why is consistency critical in social media marketing? A. It ensures better video quality B. It builds ongoing engagement and trust C. It triggers more MLS auto-updates D. It reduces ad spend
B /Explanation: Regular, relevant posts keep your brand in mind and grow your audience.
107
What is a key reason to add a visible call-to-action (CTA) during editing? A. To block competitors from copying your content B. To drive the viewer toward specific actions like website visits C. To meet NAR compliance D. To get more likes
B/ Explanation: CTAs convert views into leads or visits by prompting action clearly.
108
Which video platform is ideal for short, live interactions like virtual open houses or seminars? A. YouTube B. TikTok C. Facebook Live D. LinkedIn
C
109
Which of the following best explains why real estate market trends should be analyzed locally rather than statewide? A. Buyers generally prefer homes in rural areas B. Statewide data is only available through MLS C. Local markets can have very different supply-demand dynamics D. Online tools don’t show national trends
c/ Explanation: Real estate trends vary neighborhood to neighborhood; statewide averages often hide local market behaviors.
110
How can agents access the most accurate and current property value data? A. Free online search engines B. Government tax portals C. Membership-based MLS and real estate board tools D. Social media forums
✅ Correct Answer: C Explanation: Licensed professionals have exclusive access to real-time data through MLS systems.
111
Which of the following best defines the supply unit for commercial real estate? A. Acreage B. Households C. Dwelling units D. Square feet
D
112
An appraiser can be a useful resource for agents because: A. They are not legally allowed to disclose market data B. They work directly with listing portals C. They often track local trends closely for valuation purposes D. They publish free MLS data publicly
✅ Correct Answer: C Explanation: Appraisers often have detailed knowledge of market shifts and data-backed insights.
113
Why is real estate considered an illiquid asset? A. It cannot be sold without a home warranty B. All real estate transactions require state approval C. It often takes time and effort to sell, and there’s no exact duplicate D. It depreciates faster than other investments
✅ Correct Answer: C Explanation: Selling property involves complexity and delay, and each parcel is unique.
114
Which factor does NOT directly influence real estate supply? A. Labor availability B. Community master plan C. Net population increase D. Investment returns
✅ Correct Answer: C Explanation: Net population change impacts demand, not supply.
115
Which is a primary unit for measuring residential demand? A. Acreage B. Square feet C. Households D. Zoning permits
✅ Correct Answer: C Explanation: Residential demand is based on the number of households needing homes.
116
Why might agents monitor local newspapers or legal journals? A. To avoid lawsuits from competitors B. To gather social media tips C. To find public notices related to foreclosures, divorces, or job shifts D. To calculate future tax rates
✅ Correct Answer: C Explanation: These sources reveal motivated sellers and changes affecting market movement.
117
Which of the following best describes a Comparative Market Analysis (CMA)? A) An appraisal conducted by a licensed appraiser B) A legal document filed with the county C) A report of similar recent sales made by a listing agent D) A record of public tax assessments in the area
Correct Answer: C Explanation: A CMA is performed by a real estate agent, not an appraiser, and compares similar properties.
118
A home appraised at €350,000 ends up selling for €300,000. What term applies to €300,000? A) Market value B) Replacement cost C) Exchange value D) Selling price
Correct Answer: D Explanation: Selling price is the actual price a buyer pays, regardless of appraised market value.
119
What is not a condition for establishing fair market value? A) Seller is under duress B) Market is competitive C) Buyer and seller are unrelated D) Property has a marketable title
Correct Answer: A Explanation: Fair market value assumes no pressure or distress—duress undermines a fair market condition.
120
. If a property sells for more than market value because of personal property included in the deal, what does this demonstrate? A) Tax manipulation B) Zoning error C) Discrepancy between market value and selling price D) Accurate use valuation
Correct Answer: C Explanation: The selling price can be higher due to items not factored into the property’s market value.
121
A homeowner adds a custom wine cellar for $50,000 but sees no price increase in market value. This shows the difference between: A) Replacement cost and appraisal B) Cost and market value C) Assessed value and exchange value D) Use value and reproduction cost
Correct Answer: B Explanation: Just because you spend money doesn’t mean the market will value the improvement equally.
122
. What is not a component of a property’s use value? A) Property’s ability to generate rent B) Tax benefits C) Market value compared to comps D) Specific utility to the owner
Correct Answer: C Explanation: Use value is owner-specific; market value relates to comparisons, not personal benefits.
123
The most accurate definition of market value is: A) The average of recent sales in the area B) What the seller paid originally C) The cost to rebuild the home D) The price under fair and open market conditions
Correct Answer: D Explanation: Market value reflects what a buyer is willing to pay and a seller is willing to accept under ideal conditions.
124
Which principle says a buyer won’t pay more for a home if similar ones are available for less?
Correct Answer: C Explanation: Substitution is about choosing a comparable option at a lower price.
125
f a large home’s value decreases because it’s surrounded by smaller, lower-value homes, what is this an example of? A) Progression B) Regression C) Highest and best use D) Functional obsolescence
B
126
Which zoning change is most likely to increase property value? A) Industrial to residential B) Commercial to residential C) Residential to commercial D) Commercial to green space
Correct Answer: C Explanation: A residential property rezoned to commercial often gains more value due to business potential.
127
Which of the following is not required for a property’s use to be considered its highest and best? A) Environmentally sustainable B) Legally permissible C) Maximally productive D) Financially feasible
Correct Answer: A Explanation: Environmental sustainability is not one of the four conditions—legal, physical, financial, productive are.
128
What is exchange value in real estate? A) Income received from leases B) Value determined by tax authority C) Value based on market comparisons D) Cost to reproduce a property exactly
Correct Answer: C Explanation: Exchange value is what a property is worth relative to other similar properties on the market.
129
Which of these does not typically influence residential buyers? A) Sales per square foot B) Access to schools C) Neighborhood quality D) Lifestyle alignment
Correct Answer: A Explanation: Sales per square foot is a concern for retail users, not residential homeowners.
130
What is a correct example of the supply and demand principle in real estate? A) The city halts all new permits B) A home is the only one available in a sought-after area C) A seller lowers the price to undercut competition D) A developer builds luxury homes in a low-income area
Correct Answer: B Explanation: Low supply and high demand increase value — this is classic supply-demand behavior.
131
Which appraisal method is most appropriate for a newly built warehouse with no recent comparable sales or rental income? A) Income Approach B) Sales Comparison Approach C) Cost Approach D) Assemblage Valuation
Correct Answer: C Explanation: The cost approach works best for new or unique properties when no comps or income data exist.
132
Which of the following best reflects reproduction cost? A) Cost to build a modern version of a similar house B) Cost to construct an identical replica of the building today C) Cost to repair structural defects D) Depreciated historical cost
Correct Answer: B Explanation: Reproduction cost means building an exact duplicate—flaws and all—at today's prices.
133
Why is the sales comparison approach considered the most reliable method for valuing a single-family residence? A) It focuses solely on land value B) It eliminates the need for adjustments C) It reflects real buyer behavior based on recent sales D) It accounts for future rental income
Correct Answer: C Explanation: This approach reflects what buyers are actually paying for similar homes in the market.
134
The principle of substitution is used in: A) Only the cost approach B) Only the income approach C) All three approaches D) The income and sales comparison approaches
Correct Answer: D Explanation: Substitution is used in both income and sales approaches to compare cost/value alternatives.
135
When appraising an outdated building with unique architecture, which cost method is best? A) Income-based net return B) Reproduction cost C) Replacement cost D) Plottage
Correct Answer: C Explanation: Replacement cost accounts for modern materials and is ideal for appraising older buildings.
136
In the income approach, the biggest challenge for appraisers is: A) Estimating depreciation B) Comparing floor plans C) Determining net income and rate of return D) Adjusting for improvements
Correct Answer: C Explanation: Income and investor return data can be hard to verify or accurately estimate.
137
Which of the following is not a step in preparing a CMA? A) Estimating the seller’s net sheet B) Choosing comparables C) Adjusting comparable values D) Analyzing subject property details
Correct Answer: A Explanation: Estimating net proceeds is part of a listing consultation, not the CMA itself.
138
Which neighborhood factor typically raises property value? A) High vacancy rates B) Owner-occupied homes C) Close proximity to industrial zones D) Poor school district ratings
Correct Answer: B Explanation: Owner-occupied homes tend to be better maintained, which boosts nearby values.
139
What does the frontage of a lot refer to? A) Width at the back boundary B) Side-to-side measurement across the backyard C) Distance along the main road or body of water D) Depth from street to rear boundary
Correct Answer: C Explanation: Frontage is the linear measurement along a street, lake, or road — a key value factor.
140
A pie-shaped lot that widens at the back but is narrow in front would primarily affect: A) Depth B) Shape and perceived value C) Area D) Zoning designation
Correct Answer: B Explanation: Irregular shapes affect desirability and adaptability, even if total area is adequate.
141
Which property characteristic is most likely to decrease value if present? A) Southern-facing slope B) Easements and encroachments C) Proximity to schools D) Rolling terrain
Correct Answer: B Explanation: Legal access issues or third-party use rights (easements) reduce market appeal.
142
What principle states that the combined value of two adjacent lots may be greater than their individual values? A) Plottage (Assemblage) B) Regression C) Highest and Best Use D) Contribution
Correct Answer: A Explanation: Plottage occurs when combining lots increases total value through better utility.
143
What site factor is least likely to impact appraisal value? A) Depth of the lot B) Shape of the lot C) School district performance D) Title font size on deed
Correct Answer: D Explanation: Title formatting doesn’t affect property value; physical and location factors do.
144
Which of the following is excluded when calculating the square footage of a home's living area? A) Heated sunroom B) Finished attic with HVAC C) Attached garage D) Air-conditioned master bedroom
Correct Answer: C Explanation: Living area doesn’t include garages, even if attached. Only heated and cooled areas count.
145
hich home feature typically adds value but does not recover its cost? A) Central air conditioning B) Finished basement C) Solar panels D) Kitchen upgrades
Correct Answer: B Explanation: Finished basements add value but rarely enough to justify the cost of the improvement.
146
A three-bedroom home is priced at $285,000. A nearly identical four-bedroom home in the same neighborhood is priced at $305,000. What is being demonstrated? A) Principle of assemblage B) Functional obsolescence C) Bedroom contribution value D) Regression
Correct Answer: C Explanation: Bedrooms add measurable value; more bedrooms usually increase price if layout is similar.
147
Which factor most likely results in a poor CMA adjustment if overlooked? A) Garage orientation B) Number of closets C) Property age and actual condition D) Landscaping variety
Correct Answer: C Explanation: Condition often affects perceived age and value, which is essential for making adjustments.
148
What interior design flaw can reduce a home's appeal to buyers? A) Kitchen located next to the garage B) Bathroom accessed only through a bedroom C) Dining room directly off the kitchen D) Master bedroom having an en-suite bathroom
Correct Answer: B Explanation: Poor access to common spaces like bathrooms through private rooms is seen as a flaw.
149
Which garage feature would typically add the most value? A) A detached garage with a dirt driveway B) A carport with a storage shed C) A two-car attached garage with interior access D) A covered outdoor parking space
Correct Answer: C Explanation: Attached garages with indoor access are most desirable and increase perceived value.
150
. What do expired listings often indicate? A) Market has cooled B) Properties were underpriced C) Overpricing caused the listing to fail D) Buyers rejected the area
Correct Answer: C Explanation: Homes usually fail to sell because the price was too high compared to market expectations.
151
Which of the following should be emphasized to help a seller understand how competition affects pricing? A) Their home is unique B) Active listings may never sell C) Buyers have choices and won’t overpay D) Pending sales close faster
Correct Answer: C Explanation: Buyers will compare your listing to others. If it's overpriced, they’ll choose the better deal.
152
What information should be collected for both the subject property and the comparables? A) Owner’s mortgage history B) School zoning permit C) Lot shape and orientation D) Tax deductions claimed by owner
Correct Answer: C Explanation: All physical site characteristics (shape, slope, orientation) should be consistently documented.
153
Why must licensees understand area measurement standards before doing a CMA? A) State law requires accuracy in appraisal B) Overstated square footage can inflate price and mislead sellers C) It avoids commission disputes with other agents D) MLS doesn't accept inaccurate listings
Correct Answer: B Explanation: CMA pricing depends heavily on square footage, and inaccurate estimates can skew the price.
154
Which of the following design elements is likely to boost appeal to a large family? A) Master bedroom without a bathroom B) Eat-in kitchen with no counter space C) Separate family room and laundry room D) Single bathroom for a four-bedroom home
Correct Answer: C Explanation: Families need functional spaces like family rooms and separate laundry rooms.
155
. Which energy efficiency feature is least likely to affect a home's market value? A) Double-paned windows B) Energy Star-rated appliances C) Smart home systems D) Standard wall insulation
D
156
What is the primary risk of applying mass marketing to real estate clients in Texas? A) It violates Texas Deceptive Trade Practices B) It ignores individual property values C) It may fail to comply with Fair Housing laws D) It reduces promotional costs significantly
C – Fair Housing laws prohibit discriminatory or overly generalized marketing.
157
Which of the following best describes the concept of “subjective value” in real estate pricing? A) The amount determined by a tax assessor B) The market price calculated using a CMA C) The buyer’s personal perception of worth D) The appraiser’s official valuation
Answer: C Subjective value is based on personal emotions or preferences, not market data.
158
Why might price per square foot not be a reliable indicator of value? A) It excludes bedroom count B) It ignores property age and updates C) It's not used in Texas CMAs D) It doesn’t account for garage type
Answer: B Price per square foot overlooks upgrades, remodels, and overall condition differences.
159
Which of the following is not one of the 4 P's in the marketing mix? A) Price B) Profit C) Place D) Product
Answer: B The 4 P’s are Price, Product, Place, and Promotion. Profit is a result, not a strategy
160
A real estate licensee makes CMA adjustments based on bedroom count. How much should they adjust for an additional bedroom? A) $2,000 B) $3,000 C) $3,500 D) $5,000
Answer: C An additional bedroom is typically adjusted at about $3,500 depending on the market.
161
Which of the following statements about appraisals is accurate? A) They are done by listing agents before showings B) They are optional when cash buyers are involved C) They guarantee the selling price D) They replace the need for CMAs
Answer: B Appraisals are generally required by lenders. Cash buyers can skip them.
162
When would the Cost Approach to appraisal most likely be used? A) For rental duplexes B) For high-end resale homes C) For a new custom-built home D) For urban multi-family buildings
Answer: C The cost approach is best for new or unique properties where comps are scarce.
163
What is the likely result of overpricing a home compared to similar active listings? A) Bidding wars B) Faster closings C) Expired listing D) Higher appraisal
Answer: C Overpriced homes often sit too long and eventually expire with no offers.
164
Which valuation principle reflects that a home may be worth more or less based on nearby homes? A) Anticipation B) Contribution C) Progression and Regression D) Change
Answer: C Progression raises value near better homes, regression lowers it near worse homes.
165
Which of the following duties is not typically the responsibility of the listing broker? A) Coordinating title document corrections B) Verifying lien payoffs C) Attending the home inspection with the buyer D) Preparing the closing worksheet
Answer: C Explanation: Attending inspections is the buyer’s agent (cooperating broker)'s job, not the listing broker’s.
166
Which of the following would be most appropriate for a cooperating broker to do? A) Explain how to prepare the settlement statement B) Determine which liens to pay at closing C) Negotiate contract terms with the seller on behalf of the buyer D) Disburse escrow funds
Answer: C Explanation: Cooperating brokers represent buyers in negotiations. Disbursing funds and settlement statements are listing broker duties.
167
The Commission requires that a listing broker obtain what before offering a commission split? A) Written approval from buyer’s broker B) Verbal consent from buyer C) Consent from seller D) Approval from the title company
C
168
What does the term “Good Funds” mean in the context of broker responsibilities? A) Funds that exceed earnest money B) Funds that are guaranteed and available for disbursement C) Funds paid by cashier’s check only D) Funds that are returned if the closing is delayed
Answer: B Explanation: “Good Funds” are cleared and ready for disbursement at closing — a listing broker must ensure this.
169
Which of the following is a duty specific to the cooperating broker? A) Preparing the seller’s payoff figures B) Overseeing utility proration C) Attending buyer’s property inspections D) Verifying property tax liens
Answer: C Explanation: Only the cooperating broker attends inspections with the buyer. The listing broker handles financials.
170
If a cooperating broker delays document return, what is the likely impact? A) Closing proceeds early B) The listing expires C) The closing may be delayed D) The title company cancels escrow
Answer: C Explanation: Delayed documents can stall closing, which is why prompt handling is a duty of the cooperating broker.
171
Which of the following best reflects the listing broker’s role during financial review? A) Helping the buyer select a lender B) Verifying that all taxes and liens are cleared C) Finalizing insurance documents D) Reviewing buyer’s lease history
Explanation: The listing broker works with lenders and title companies to ensure liens and taxes are cleared.
172
Why might an agent need to estimate a buyer’s borrowing power before they meet with a lender? A) To prevent the lender from declining the buyer B) Because lenders are not allowed to pre-approve without agent input C) Buyers might feel pressured or resist lender meetings early on D) To calculate their commission more accurately
Explanation: Some buyers fear early lender involvement feels pushy, so agents must be ready to estimate affordability.
173
Which of the following is true regarding a HUD reverse annuity mortgage (RAM)? A) It must be repaid monthly even if the borrower stays in the home B) It requires that the borrower’s income not exceed a set threshold C) It is only available for new construction D) It does not need to be repaid as long as the borrower remains in the home
Explanation: HUD RAMs don’t require repayment while the borrower lives in the home. The lender is paid when the home is sold.
174
What is the main advantage of a HUD RAM compared to conventional RAMs? A) It pays interest to the borrower B) It includes mortgage insurance that covers shortfalls after death C) It does not require FHA approval D) It provides higher LTV percentages across all ages
Explanation: HUD covers any shortfall if the home value is less than the loan amount when sold.
175
What determines the size of a reverse annuity mortgage under HUD guidelines? A) The borrower's credit score and income B) Age of the borrower, interest rate, and home value C) Purchase price and cost of insurance D) Home age and location
Explanation: HUD RAMs are calculated based on the borrower's age, interest rate, and the appraised value of the property.
176
Why would an 85-year-old be able to borrow more (higher LTV) than a 65-year-old? A) Lenders are more lenient with older borrowers B) FHA rules increase LTV for higher property values C) The risk of the loan outlasting the borrower is lower D) Older homes depreciate faster
Answer: C Explanation: Older borrowers have shorter life expectancies, reducing the risk of the lender not being repaid for many years.
177
What is a key risk-reduction feature of new “low/doc” loans compared to past versions? A) Higher down payments must be paid in cash only B) Lenders can access tax returns later if loan defaults C) Loans must be insured by HUD D) Borrowers must have owned a business for 10+ years
Answer: B Explanation: A signed document may give lenders future access to tax returns to verify income if the loan appears risky.
178
What best describes a portfolio loan? A) A mortgage issued only by investment banks B) A conforming loan that is federally insured C) A loan the lender keeps instead of selling on the secondary market D) A loan that must be used for investment property only
Answer: C Explanation: A portfolio loan stays with the originating lender, allowing more flexible approval terms.
179
What are lenders most likely to require for a self-employed borrower? A) Proof of employment from an HR department B) Personal recommendations from clients C) Two years of full tax returns and a profit & loss statement D) A notarized statement of intent to repay
C
180
Which of the following accurately describes the use of a RAM to purchase a home? A) It provides tax benefits when used with FHA loans B) It allows buyers to finance a home with no cash down C) It lets the buyer use equity from the home being purchased D) It requires at least 50% down to qualify
Answer: C Explanation: Seniors can use a reverse mortgage to buy a new home and draw equity from that same property.
181
In an installment sale, what determines when the seller pays taxes on the sale proceeds? A. When the deed is transferred B. When the buyer takes possession C. When payments are received D. When the contract is signed
Answer: C Explanation: Taxes are due only on the payments actually received by the seller each year.
182
Which of the following is not a typical component of a lease-purchase agreement? A. Seller retains title during the lease term B. Purchaser has a non-refundable deposit C. Option to cancel at any time D. Accelerated rent with credit back
Answer: C Explanation: A lease-purchase is a binding contract for purchase, not an option to cancel freely.
183
In Texas, who is allowed to draft a lease-purchase agreement? A. Any licensed real estate broker B. Any real estate agent with TAR forms C. Only an attorney D. The title company
Answer: C Explanation: Texas law prohibits agents from preparing lease-purchase agreements — it must be done by a licensed attorney.
184
What happens if any part of the sale proceeds in a 1031 exchange is disbursed to the seller before closing on the replacement property? A. It is taxed as income B. It becomes illegal C. The exchange is disqualified D. It delays the timeline
Answer: C Explanation: Receiving any funds directly disqualifies the 1031 exchange and triggers capital gains taxes.
185
What is “boot” in a 1031 exchange? A. A second mortgage B. A title encumbrance C. Unequal equity or cash received D. The 1031 facilitator
Answer: C Explanation: Boot refers to cash or other compensation that is not like-kind property and is taxable.
186
FHA Title I loans are primarily used for: A. Buying investment property B. Funding down payments C. Home improvements D. Paying off reverse mortgages
Answer: C Explanation: FHA Title I loans are designed to fund home improvements, not purchases.
187
Which of the following is true about FHA Title I loans? A. Interest is subsidized by HUD B. Loans are only for multi-unit buildings C. They require no insurance D. They are fixed-rate and market-based
Answer: D Explanation: These loans are fixed-rate at market rates and insured by HUD, but not subsidized.
188
Which of the following is not an example of a lien on a property? A. Property tax bill B. Utility right-of-way C. Mortgage loan D. Court-ordered judgment
Answer: B Explanation: A utility right-of-way is an encumbrance, not a lien.
189
What best defines “marketable title”? A. A title with minor defects that the buyer accepts B. A title that allows resale within 90 days C. A title free of legal defects, giving confidence of ownership D. A title approved by the broker
Answer: C Explanation: A marketable title is free from legal defects and assures the buyer they won’t have to defend ownership.
190
What is a “joint-protection standard coverage policy”? A. A policy covering both the buyer and seller equally B. A lender-only policy that includes tax protection C. A policy issued to both lender and buyer D. A policy that insures against zoning violations
✅ Correct Answer: C Explanation: It’s a standard title insurance policy that protects both the lender and the buyer.
191
What must buyers do when they receive a preliminary title report? A. Pay the title insurance premium B. Sign the mortgage loan C. Acknowledge receipt of the report D. Submit their personal tax returns
✅ Correct Answer: C Explanation: Buyers must acknowledge they’ve received the preliminary report which outlines the condition of title prior to closing.
192
Which of the following items would most likely be EXCLUDED from a standard title insurance policy? A. A forged mortgage B. Federal estate tax liens C. Unrecorded mechanic's liens D. Acts by mentally incompetent sellers
✅ Correct Answer: C Explanation: Standard policies usually exclude unrecorded claims that could have been found through inspection or a survey.
193
Why is a preliminary title report ordered early in the closing process? A. To provide immediate title insurance coverage B. To allow time to clear or investigate title issues before closing C. To replace the final title report D. To determine the buyer’s loan eligibility
✅ Correct Answer: B Explanation: Ordering it early allows time to resolve any liens or defects before the deal closes. It is not insurance coverage.
194
When is title insurance paid for in a real estate transaction? A. Annually B. Monthly with mortgage payments C. At closing, one time only D. Before the listing agreement is signed
✅ Correct Answer: C Explanation: Title insurance is a one-time payment made at closing and remains in effect until the property is sold again.
195
Which of the following would NOT typically be covered under a standard title insurance policy? A. Forged deeds B. Misfiled legal documents C. Unrecorded easements discovered by a survey D. Mistaken legal interpretation of a will
✅ Correct Answer: C Explanation: Unrecorded claims discovered through physical inspection or surveys are excluded from standard coverage.
196
What is the primary purpose of title insurance in a real estate transaction? A. To guarantee the buyer gets a good mortgage rate B. To protect the lender and buyer from future property tax increases C. To cover losses from title defects and defend ownership in court D. To eliminate the need for a title search
✅ Correct Answer: C Explanation: Title insurance protects against losses from hidden defects in the title and includes legal defense if the ownership is challenged.
197
What makes extended coverage title insurance more comprehensive than standard coverage? A. It insures against recorded encumbrances only B. It covers only what’s listed on the deed C. It protects against unrecorded claims and off-record issues D. It guarantees market value at the time of closing
✅ Correct Answer: C Explanation: Extended coverage includes risks like unrecorded liens and physical possession claims, which standard coverage does not.
198
Which of the following is typically NOT included in a standard owner’s title insurance policy? A. Forged documents B. Undisclosed heirs C. Unrecorded easements D. Confusion from similar
✅ Correct Answer: C Explanation: Standard policies exclude off-record easements, which are included only in extended coverage.
199
Who usually delivers the purchase contract to the escrow agent? A. The buyer B. The escrow officer C. The listing broker D. The lender or real estate agent
✅ Correct Answer: D Explanation: The lender or agent typically delivers the contract to the escrow agent to initiate the process.
200
Which of the following is NOT typically needed to open escrow? A. Property’s legal description B. Buyer’s loan application C. Earnest money deposit D. Commission terms
Explanation: The loan application goes to the lender, not the escrow agent. The other items are part of escrow setup.
201
What is the purpose of a preliminary title report during escrow? A. To determine the buyer’s financing eligibility B. To disclose recorded title issues before issuing insurance C. To list the appraised value D. To confirm pest control inspections
✅ Correct Answer: B Explanation: The preliminary report alerts the lender and buyer to recorded issues before final title insurance is issued.
202
If someone removes a document from a transaction file, what must they do? A. Replace it with a note stating it's checked out B. Refile it in the exact same location C. Send it to the broker for approval D. Keep it for their records
✅ Correct Answer: B Explanation: Transaction files must stay organized and consistent — misfiling is unacceptable.
203
Which file does NOT need to be retained in a transaction file? A. Public record documents B. Buyer’s financial info (owner-carry) C. Commission remittance D. Settlement statement
✅ Correct Answer: A Explanation: Public records (like recorded deeds) do not need to be retained by the broker.
204
If you are a cooperating broker and not a party to the listing agreement, which document are you NOT required to keep? A. Buyer’s financial information B. Earnest money receipt C. Seller’s closing statement D. Settlement statement for the buyer
✅ Correct Answer: C Explanation: Cooperating brokers not part of the listing side don’t need to keep the seller’s closing documents.
205
What type of file system is recommended for keeping physical transaction files? A. Alphabetical by broker name B. Random access by office assistant C. By property address, with consistent sub-files D. By client’s last name, scanned only
✅ Correct Answer: C Explanation: Using property address with standardized sub-files ensures consistency and legal compliance.
206
Which document is usually NOT part of the required sales file? A. Inspection notice B. Deed of trust (copy with recording) C. Listing agreement (for cooperating broker) D. Actual closing instructions
✅ Correct Answer: C Explanation: Cooperating brokers don’t need to keep listing agreements unless they are party to it.
207
Which of the following is NOT part of a business (operational) records file? A. Commission checks from closings B. Corporate tax returns C. Bank account agreements D. Office lease documents
✅ Correct Answer: A Explanation: Commission checks belong in transaction files, not business operation files.
208
In proper physical document filing, what is the benefit of hole-punching and top-clipping documents in order received? A. It eliminates the need for backups B. It allows you to discard older documents C. It creates a clear timeline and quick access to recent records D. It complies with IRS code
✅ Correct Answer: C Explanation: Punching and stacking by date helps track document history and access recent records easily.
209
Which of the following documents would most likely be filed in your corporate records folder? A. Listing agreement B. Client financial info C. Business EIN confirmation D. Inspection notice
✅ Correct Answer: C Explanation: Business ID documentation like your EIN goes in your corporate records folder.
210
What is the correct formula to calculate a business's equity? A. Assets + Liabilities = Equity B. Revenue – Expenses = Equity C. Assets – Liabilities = Equity D. Revenue + Assets = Equity
✅ Correct Answer: C Explanation: Equity = Assets – Liabilities. It's the owner’s stake in the business.
211
Which of the following would be classified as a liability in your accounting records? A. Office chairs B. Listing income C. Mortgage on your office D. Tax refund
✅ Correct Answer: C Explanation: Debt or anything owed (like a mortgage) is recorded as a liability.
212
Why do most large companies use the accrual accounting method? A. It makes taxes easier B. It shows financials when cash is transferred C. It gives a more accurate picture of financial health D. It is simpler to manage with small transactions
✅ Correct Answer: C Explanation: Accrual accounting matches income and expenses at the time the business activity occurs.
213
What is the purpose of a profit and loss (P&L) statement? A. To track individual employee bonuses B. To display tax liabilities C. To summarize revenues and expenses over a set period D. To calculate property square footage
✅ Correct Answer: C Explanation: P&Ls summarize business income and expenses, showing net profit or loss.
214
What’s a recommended way to keep physical receipts organized for small real estate businesses? A. Throw away anything under $25 B. Staple them to full-size paper and file chronologically C. Tape them to the side of your desk D. Store them in a plastic bag monthly
Correct Answer: B Explanation: Small receipts should be stapled to 8.5" x 11" paper for filing by date in folders
215
What happens when you file your first business tax return? A. You automatically become a fiscal year filer B. You choose your tax preparer for the next five years C. You lock in your accounting year and method D. You establish your Social Security withholding bracket
✅ Correct Answer: C Explanation: Your first return sets your accounting year (calendar/fiscal) and method (cash/accrual). You need IRS approval to change them later.
216
Which of the following business types does NOT file an income tax return? A. Sole proprietorship B. S corporation C. Partnership D. Corporation
✅ Correct Answer: C Explanation: Partnerships file an information return (Form 1065), not a tax return.
217
What is the income tax threshold for estimated payments by an individual real estate broker? A. $400 B. $600 C. $1,000 D. $2,500
✅ Correct Answer: C Explanation: Individuals (sole proprietors, partnerships, S-corps) must make estimated payments if they expect to owe more than $1,000.
218
A corporation must pay estimated taxes if its tax liability exceeds: A. $400 B. $500 C. $1,000 D. $1,500
✅ Correct Answer: B Explanation: Corporations must pay quarterly estimated tax if expected liability exceeds $500.
219
Which tax covers Social Security and Medicare for self-employed individuals? A. Income Tax B. SE Tax C. FICA Tax D. Excise Tax
✅ Correct Answer: B Explanation: Self-employment (SE) tax covers Social Security and Medicare for self-employed individuals.
220
What is the income threshold at which a self-employed person must pay SE tax? A. $400 B. $600 C. $1,000 D. $2,000
✅ Correct Answer: A Explanation: Anyone self-employed who earns over $400/year must file and pay SE tax.
221
What part of the SE tax can be deducted on your personal Form 1040? A. One-quarter B. One-third C. One-half D. All of it
✅ Correct Answer: C Explanation: You can deduct half of your self-employment tax on your individual tax return.
222
. Who is responsible for paying unemployment taxes? A. The employee only B. The IRS C. The employer only D. Both employer and employee
✅ Correct Answer: C Explanation: Employers pay 100% of unemployment taxes; employees do not contribute.
223
Which form is used by an employee to declare withholding exemptions? A. W-2 B. I-9 C. W-4 D. 1099
✅ Correct Answer: C Explanation: The W-4 is completed by the employee to declare withholding status and exemptions.
224
What is the I-9 form used for? A. Reporting yearly earnings B. Declaring a new hire’s tax status C. Certifying eligibility to work in the U.S. D. Withholding FICA
✅ Correct Answer: C Explanation: The I-9 verifies an employee's legal right to work in the U.S.
225
After the tax year, what form must employers give employees to report total earnings and withholdings? A. 1099-MISC B. W-9 C. W-2 D. 8300
✅ Correct Answer: C Explanation: The W-2 reports annual wages and taxes withheld for each employee.
226
If you pay an independent contractor over $600, which form must be filed? A. W-4 B. W-2 C. 1099-MISC D. 8300
✅ Correct Answer: C Explanation: Payments over $600 to non-employees (e.g. photographers, attorneys) require a 1099-MISC.
227
Which form must be used if you receive more than $10,000 in cash in one or more related transactions? A. 1099-MISC B. 8300 C. W-2 D. I-9
✅ Correct Answer: B Explanation: Form 8300 is required for reporting over $10,000 in cash received in a single or related transactions.
228
Excise taxes are typically NOT relevant to real estate brokerage firms because: A. Real estate agents are exempt from all business tax B. Excise taxes only apply to inventory sales C. Excise taxes are state-level only D. Real estate is not a taxed service
✅ Correct Answer: B Explanation: Excise taxes generally apply to goods like gasoline, not real estate services.
229
If you make an error on a required tax form, you must correct it by what date to avoid penalty? A. December 31 B. August 1 C. April 15 D. January 31
✅ Correct Answer: B Explanation: You have until August 1 to correct errors and avoid IRS penalties.
230
What happens to startup cost deductions if your total startup costs exceed $50,000? A. All startup expenses are denied B. Only 50% are allowed C. The $5,000 immediate deduction is reduced D. The costs must be written off within one year
✅ Correct Answer: C Explanation: The $5,000 deduction is reduced dollar-for-dollar when startup costs exceed $50,000. Excess must be amortized
231
Which of the following is considered a capital expense rather than a deductible operational expense? A. Advertising during business B. Meals with clients C. Office equipment purchase D. MLS dues
✅ Correct Answer: C Explanation: Equipment purchases are capital expenses and typically recovered via depreciation.
232
Which statement about depreciation is TRUE under IRS rules? A. You can skip a year and claim it the next B. It must be spread over the asset’s useful life C. It can only be claimed in cash-based accounting D. You deduct the full value the year of purchase
✅ Correct Answer: B Explanation: Depreciation must be taken annually over the item's useful life — you cannot postpone or front-load it.
233
What IRS publication outlines startup and organizational expense deductions for small businesses? A. Publication 17 B. Publication 583 C. Publication 505 D. Publication 946
✅ Correct Answer: B Explanation: Publication 583 covers startup expenses, recordkeeping, and business tax basics.
234
What is the main reason to keep detailed asset records for your business? A. To apply for a home loan B. To track listing appointments C. To calculate depreciation and verify ownership D. To apply for unemployment
✅ Correct Answer: C Explanation: Asset records support depreciation claims and help track asset value and sale history.
235
What is a Section 179 deduction? A. An expense unrelated to real estate B. A method to fully deduct certain capital assets upfront C. A business penalty for late filing D. A depreciation method used only in retail
✅ Correct Answer: B Explanation: Section 179 lets businesses deduct the full cost of qualifying assets in the first year, up to IRS limits
236
Why does the IRS require keeping canceled checks, invoices, and receipts in chronological order? A. To audit employees' work B. For annual budgeting C. To verify business deductions and establish a timeline D. To file local property taxes
✅ Correct Answer: C Explanation: Organizing receipts chronologically helps validate the timing and legitimacy of claimed deductions.
237
Which of the following forms would NOT typically be part of a small real estate brokerage's bookkeeping system? A. Depreciation worksheet B. Daily cash receipt summary C. Client intake log D. Disbursement journal
✅ Correct Answer: C Explanation: While useful, a client intake log isn't a financial bookkeeping form. The others track income or expenses
238
What’s the main purpose of reconciling your checkbook with your bank statement? A. To review tax liabilities B. To prepare an income statement C. To identify recording or math errors D. To evaluate marketing effectiveness
✅ Correct Answer: C Explanation: Reconciling helps identify discrepancies due to math errors, missed entries, or timing of deposits/checks
239
When should reconciliation between your business records and your checkbook occur? A. Once a year, after tax season B. Before comparing your bank statement to your checkbook C. Only when you suspect fraud D. Before accepting a new client
✅ Correct Answer: B Explanation: Always reconcile your internal records against your checkbook before comparing it to the bank statement.
240
In double-entry bookkeeping, what must always be equal after posting journal entries? A. Assets and liabilities B. Credits and income C. Debits and credits D. Expenses and deposits
Explanation: Double-entry bookkeeping requires debits and credits to always match.
241
What does a single-entry system typically track? A. Assets, liabilities, and depreciation B. Expenses only C. Income and expenses for P&L D. Inventory movement
✅ Correct Answer: C Explanation: Single-entry bookkeeping focuses on basic profit and loss tracking — income and expenses
242
What is a typical range for total buyer and seller closing costs? A. 0.5% – 1% of sales price B. 1% – 3% of loan amount C. 2% – 7% of the purchase price D. 10% – 12% of appraised value
✅ Correct Answer: C Explanation: Most real estate closings involve 2–7% in combined closing costs depending on the deal and lender fees
243
A buyer pays a 1% loan origination fee on a $200,000 mortgage. What is the fee amount? A. $1,000 B. $2,000 C. $3,000 D. $4,000
✅ Correct Answer: B Explanation: 1% of $200,000 is $2,000, the cost of the loan origination fee.
244
What does UFMIP stand for in the context of FHA loans? A. Unified Federal Mortgage Insurance Plan B. Underwriter Fee Mortgage Insurance Premium C. Upfront Mortgage Insurance Premium D. Unfunded Monthly Interest Payment
✅ Correct Answer: C Explanation: Upfront Mortgage Insurance Premium is required for FHA loans and paid at closing.
245
A borrower’s MIP rate is 0.80% annually on a $250,000 FHA loan. What is their annual MIP cost? A. $200 B. $2,000 C. $2,500 D. $3,000
✅ Correct Answer: B Explanation: 0.80% of $250,000 = $2,000 per year in Mortgage Insurance Premium.
246
Why is the property appraisal particularly critical for high-LTV loans? A. It helps agents justify commission rates B. It determines the listing price for future resale C. It validates collateral value for the lender D. It allows the buyer to skip title insurance
✅ Correct Answer: C Explanation: Lenders need current valuation to ensure the property secures their risk, especially with high LTV (96.5%, 97%, 100%).
247
In Texas, who is typically required to purchase title insurance for the buyer’s protection? A. The buyer’s lender B. The title company C. The seller D. The appraiser
✅ Correct Answer: C Explanation: In Texas, sellers typically purchase title insurance to guarantee clear title to the buyer.
248
Which of the following is commonly included in the title company's “Settlement Fee”? A. Appraisal and termite report B. Survey and marketing analysis C. Escrow fee, loan closing fee, overnight delivery D. Buyer’s agency commission
✅ Correct Answer: C Explanation: The Settlement Fee bundles escrow, closing, and often courier fees.
249
Which of the following inspections could be ordered after a negative appraisal report? A. MLS verification B. Roof or termite inspections C. Marketing ROI audit D. FHA loan eligibility
✅ Correct Answer: B Explanation: A negative appraisal may trigger follow-up inspections like roof, pest, or structural checks.
250
A buyer wants a full environmental report. What inspection might this involve? A. MLS sheet review B. Soil contamination testing C. MIP verification D. Commission audit
✅ Correct Answer: B Explanation: Environmental reports often include soil testing for contaminants or hazards
251
Which marketing attribution method provides the most accurate but also most complex insights? A. Single Attribution (First Touch) B. Revenue Cycle Projections C. Test and Control Groups D. Full Market Mix Modeling
✅ Correct Answer: D Explanation: Full Market Mix Modeling is highly accurate and insightful but complex and expensive.
252
What is the biggest challenge with using Test and Control Groups in marketing? A. They are only useful in real estate B. They don't account for external variables C. They require isolating variables and audience groups D. They only apply to digital ads
✅ Correct Answer: C Explanation: Test/control groups require strict segmentation, which adds to the complexity.
253
Which of the following extraneous variables could affect a marketing campaign’s ROI? A. Listing photos B. Macro-economic conditions C. Broker’s commission split D. Days on market
Correct Answer: B Explanation: External factors like economy or weather can heavily impact a campaign’s success
254
Which of the following marketing ROI models is least expensive but also least insightful? A. Full Market Mix Modeling B. Test and Control Group C. Single Attribution (First/Last Touch) D. Attribution across Multiple Channels
✅ Correct Answer: C Explanation: Single attribution models are cheap and easy but lack depth and accuracy.
255
What is the purpose of a “client file” in a brokerage office? A. Store deeds and title reports B. Track payroll and tax filings C. Keep long-term correspondence and general client data D. Record escrow balances
✅ Correct Answer: C Explanation: Client files hold non-transactional info such as correspondence and ongoing relationship notes.
256
Which type of accounting matches income and expenses at the time a transaction occurs, not when payment is made? A. Cash basis B. Double-entry C. Accrual accounting D. General ledger
✅ Correct Answer: C Explanation: Accrual accounting recognizes income and expenses when they’re earned/incurred, regardless of when cash moves
257
. Which of the following is NOT considered part of the five accounting elements in real estate business? A. Assets B. Debits C. Liabilities D. Equity
B (assets, liabilities, equity, revenue, expense).
258
What is the broker’s primary role after a purchase contract is signed but before closing? A. Act as escrow agent B. Handle title transfers C. Help ensure terms are met and problems resolved D. Authorize disbursement of commission
C
259
Who is responsible for producing and reviewing the closing documents to ensure accuracy and deadlines? A. The listing broker B. The closing agent C. The seller D. The buyer’s lender
✅ Correct Answer: B Explanation: The closing agent (escrow officer) prepares and verifies all documents, although brokers support the process.
260
A 1031 Exchange allows a property owner to do what? A. Convert a rental into a primary residence B. Exchange investment properties of like-kind without paying tax C. Cancel a loan prepayment penalty D. Deduct double depreciation
Correct Answer: B Explanation: A 1031 Exchange defers taxes on gains when exchanging like-kind investment properties.
261
What is the main purpose of a Profit & Loss (P&L) Statement in real estate? A. Determine property value B. Show income and expenses over time C. Track escrow balances D. Forecast market appreciation
✅ Correct Answer: B Explanation: A P&L summarizes a business’s financial performance for a set time period
262
Which of the following is true about estimated tax payments? A. They are only required for salaried employees B. They are required if no taxes were paid last year C. They are required if you expect to owe over $1,000 as a sole proprietor D. They are required only after 5 years in business
Explanation: If your expected tax due is over $1,000, you must pay quarterly estimated taxes.
263
Which business entity is NOT required to file an annual income tax return with the IRS? A. Sole proprietorship B. S Corporation C. Corporation D. Partnership
✅ Correct Answer: D 📝 Partnerships file an information return (Form 1065), not an income tax return.
264
How is income tax generally paid in the U.S. system? A. At the end of the fiscal year B. After receiving a tax bill C. As income is earned D. Once business profits are calculated
✅ Correct Answer: C 📝 Income tax is usually paid through paycheck withholdings or estimated taxes — as income is earned.
265
A C corporation is required to pay estimated taxes if its annual tax liability is expected to exceed: A. $1,000 B. $500 C. $750 D. $1,200
Correct Answer: B 📝 Corporations must pay estimated taxes if liability exceeds $500.
266
An S corporation must pay estimated taxes if its tax liability is expected to exceed what amount? A. $1,500 B. $1,000 C. $500 D. $0 — S corps don’t pay tax
B
267
Which of the following statements about estimated tax payments is TRUE? A. Estimated taxes are paid monthly. B. Partnerships never pay estimated taxes. C. Estimated taxes are due quarterly. D. Only corporations pay estimated taxes.
✅ Correct Answer: C 📝 Estimated tax payments are made quarterly, using IRS forms.
268
Who pays the income tax on a partnership’s profit? A. The IRS withholds from gross profit B. The partnership files and pays C. Each partner pays on their share of income D. No tax is due on partnership income
✅ Correct Answer: C 📝 Partners pay taxes individually based on their share reported on Schedule K-1.
269
Which of the following is FALSE about partnerships? A. They pay estimated taxes if liability > $1,000 B. They file a Form 1065 information return C. The partnership pays federal income tax D. Each partner receives a K-1
✅ Correct Answer: C 📝 Partnerships do not pay federal income tax directly — individual partners do.
270
Which of the following documents is a broker not required to keep in the transaction file? A. Contract B. Earnest money check C. Buyer’s closing statement D. Title commitment
✅ Correct Answer: D. Title commitment 📝 Explanation: Brokers are not required to keep public records, including title commitments, loan applications, or lender disclosures from third-party closing entities. The other items are part of the broker’s standard transaction file.
271
Which of the following best describes a "capped graduated split"? A. A split that decreases with each sale B. A flat 50/50 commission split C. A commission split that stops taking company revenue once a cap is hit D. A bonus structure for brokers
✅ Correct Answer: C 📝 Once the company has earned its set revenue cap, the agent earns 100% commission.
272
What happens under a “rolled back graduated split” at the start of each new year? A. All agents get an automatic 70/30 split B. High-performing agents are exempt from the reset C. Commission splits reset to the starting level D. The broker absorbs all overhead
✅ Correct Answer: C 📝 With a rollback system, agents return to the base split (like 50/50) every new year.
273
What does a “graduated split” commission model usually start at for new agents? A. 70/30 B. 60/40 C. 50/50 D. 90/10
A. 70/30 B. 60/40 C. 50/50 D. 90/10
274
In a “rolled back graduated split,” what is the key difference from a standard graduated split? A. The split decreases mid-year B. It resets annually regardless of performance C. It offers fewer leads D. The brokerage pays for all expenses
✅ Correct Answer: B 📝 The rollback model resets each year to ensure the brokerage recaptures baseline earnings.
275
Which of the following is a potential drawback of joining a small brokerage firm? A. Lack of commission tracking B. Limited external referral networks C. No access to listings D. No office space
B
276
What is the main purpose of the "objectives and plans" section in a business plan? A. Identify closing dates B. Track monthly revenue C. List specific business goals for the coming year D. Describe customer testimonials
✅ Correct Answer: C 📝 Objectives and plans lay out clear targets for the agent’s first 12 months.
277
Why is it smart for new agents to interview with at least 3 brokerages? A. To get a license faster B. So they can work at all of them part-time C. To compare fees, support, and future options D. Because TREC requires it
✅ Correct Answer: C 📝 Interviewing multiple brokerages helps agents make informed choices and keep backup options.
278
Which of the following is typically the highest monthly cost for a real estate agent working in an office? A. Utilities B. Desk fee C. Errors and Omissions Insurance D. Internet fees
✅ Correct Answer: C. Errors and Omissions Insurance 📝 Explanation: E&O Insurance is often a required protection for agents and can be the most expensive monthly office-related cost, especially in brokerages that pass that cost to agents directly
279
What is a potential additional fee agents might pay per transaction on top of commission splits? A. Open house bonuses B. Flat transaction fees (e.g. $500 per closing) C. Yard sign maintenance fees D. Client satisfaction fee
✅ Correct Answer: B
280
What type of learner prefers to hear information out loud to absorb it best? A. Visual B. Auditory C. Kinesthetic D. Passive
B
281
Which learner type absorbs best by doing and interacting directly? A. Passive B. Visual C. Kinesthetic D. Reflective
✅ Correct Answer: C
282
Generation X buyers are typically characterized by which of the following traits? A. Optimistic and tech-first B. Traditional and cautious C. Independent, often skeptical D. Emotionally driven
✅ Correct Answer: C
283
Which generation was born between 1925–1945 and heavily influenced by WWII? A. Baby Boomers B. Generation X C. Silent Generation D. Millennials
C
284
What group was the hardest hit by the housing market downturn and now rents more often? A. Millennials B. Baby Boomers C. Generation X D. Silent Generation
C
285
What kind of buyer is most likely to ask many questions and request verbal clarification? A. The visual learner B. The kinesthetic learner C. The auditory learner D. The analytic buyer
C/ Auditory learners absorb and retain information by hearing it. In real estate, they’re the ones who ask lots of questions, want you to explain everything out loud, and may prefer phone calls over emails.
286
Why is target marketing by generation useful in real estate? A. Every person in a generation behaves identically B. It reduces marketing costs C. It helps tailor strategies based on shared influences D. It’s legally required
✅ Correct Answer: C
287

SAE ( TEXAS) (12 decks)

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