mock 2 Flashcards
(100 cards)
1
Q
Under the common law of agency which of the following statements is true?
- Where the agent does not disclose that he or she is an agent and enters into the contract with a third party, the principal will have no liability for the contract.
- An agent who would not have capacity to enter into a contract herself may be able to make a valid contract on her principal’s behalf.
- In order for the principal to be bound by the contract he or she must not give authorities to his agent.
- The agency agreement which is not expressed in writing will never be enforceable
A
- An agent who would not have capacity to enter into a contract herself may be able to make a valid contract on her principal’s behalf.
2
Q
Which one of the following does NOT result from the immobility of land?
- the need for debt financing
- a vulnerability to outside environmental factors
- an inability to move a listed property to a better resale market
- the necessity for owners to travel in order to take advantage of services provided by different parcels of land
A
- the need for debt financing
3
Q
If you are showing a house that was built in 1928 and the electrical sockets only have two holes, what kind of wiring is NOT appropriate to use ?
- knob and tube
- aluminum wiring
- copper wiring
- none of the above
A
- aluminum wiring
4
Q
The Law and Equity Act contains a provision that is often referred to as “the requirement of writing”. Which of the following accurately summarizes the “requirement of writing” contained in s. 59 of the Law and Equity Act?
- A contract respecting land must be in writing or it is void.
- A contract respecting land can never be enforced against a party who has not signed it.
- A contract for the sale of land must be contained in one written document.
- None of the above three statements accurately summarizes the requirement of writing.
A
- None of the above three statements accurately summarizes the requirement of writing.
5
Q
Your client makes an offer of $600,000 to purchase a home subject to get an accessible first mortgage. A lender, who has appraised the property for 590,000 wants to give 80% loan to value ratio and a 30% gross debt service ratio. Property taxes are 3,000 and your client has a gross income of $100,000 per a year.
Amount this lender will advance (rounded to the nearest dollar) if the rate is J2= 3.75
The amortization period is 25 years, and payments are to be made monthly
- $472,000
- $427,740
- . $438,976
- $480,000
A
- $438,976
6
Q
With respect to the scope of an agent’s authority, apparent authority:
- Arises when an agent’s unauthorized act is later ratified.
- Results from the operation of the legal doctrine of estoppel
- Arises when the agent is in a transaction governed by “ customs of the trade”.
- Describes all agency authority that can be inferred in the agency agreement.
A
- Results from the operation of the legal doctrine of estoppel
7
Q
Which one of the following statutes affects the real property taxation system in British Columbia?
- Real Estate Services Act
- School Act
- Arbitration Act
- Land Transfer Form Act
A
- School Act
8
Q
Which of the following statements regarding property appraisals are true?
A. The courts provide some guidelines as to an appraiser’s legal responsibilities under tort law and contract law
B. The courts have recognized that a reasonable margin of error exists when calculating damages as a result of a negligent appraisal
C. A large overvaluation of property by an appraiser does not, by itself, establish liability on the part of the appraiser.
D. The value of real estate property can always be determined with certainty
Statements B and D are true
Statements A and C are true
Statements B, C and D are true
Statements A, B and C are true
A
Statements A, B and C are true
9
Q
As determined by the promotional mix, which of the following represents face-to-face communication with potential customers:
- Personal selling
- Public relations
- Sales presentations
- Publicity
A
- Personal selling
10
Q
A property is listed for $550,000 but the market value, as estimated in a recent appraisal, is $545,000. The property’s lending value is estimated to be $540,000. Jay and Joan purchase the home for $543,000 subject to mortgage of $432,000. What loan to value ratio was applied by the lender with whom Jay and Joan negotiated the mortgage? (Assume that the loan to value ratio was the binding constraint on the loan size).
75%
80%
70%
125%
A
80%
11
Q
In establishing the actual value of a residential property the Assessor likely will NOT consider:
- The present use of the property
- The current interest rates for mortgages
- The revenue or rental value of the property
- The location of the property
A
- The current interest rates for mortgages
12
Q
Which of the following statements about federal legislation governing mortgages is FALSE?
- The Interest Act provides that if the mortgage agreement requires interest payment but does not specify the rate of interest chargeable, the rate allowed by law is 5%.
- The Criminal Law defines a criminal rate of interest as an affective annual rate is excess of 60%.
- The Interest Act gives borrowers the right to attack the rate of interest being charged in a mortgage on the basis that the rate is either harsh or unconscionable.
- Section 10 of the Interest Act provides an individual with the right of prepayment on his or her mortgage at the expiry of five years from the date of the mortgage if the mortgage provides that it is not payable for more than 5 years from the date of the mortgage.
A
- Section 10 of the Interest Act provides an individual with the right of prepayment on his or her mortgage at the expiry of five years from the date of the mortgage if the mortgage provides that it is not payable for more than 5 years from the date of the mortgage.
13
Q
As a Mortgagor which rate would you prefer:
A. J2 = 4.5
B. J1= 4.2
C. J 365= 4.25
- Rate A
- Rate B
3 .Rate C - Impossible to calculate
A
- Rate B
14
Q
Which of the following is NOT a power or duty of the Real Estate Council?
- Levying fees on all licensees in order to meet the Council’s expenses.
- Holding disciplinary hearings.
- Collecting premiums and assessments from licensees on behalf of the Real Estate Errors and Omissions Insurance Corporation.
- Undertaking and carrying our real estate law reform to promote the interests of real estate professionals.
A
- Undertaking and carrying our real estate law reform to promote the interests of real estate professionals.
15
Q
What is the best way to distinguish between a lease and a license?
- Apply the test set out in a residential tenancy Act to determine the difference between a license and a lease
- Examine the express terms in the agreement
- Examine the words used to describe the relationship of landlord and tenant and a licensee or a licensor
- Look at the formal wording used in the document as a whole
A
- Examine the express terms in the agreement
16
Q
A property is located in the area where there are a lot of trees. That fact that the tree roots began to destroy the foundation of the property is known as:
- A Patent defect
- An encumbrance
- A Latent defect
- A fundamental mistake
A
- A Latent defect
17
Q
Tenancy “at will” is:
- a tenancy where the tenant, with the consent of the landlord, occupies land as a tenant for a term which can be terminated by either party at any time
- is a contract between the landlord and the tenant, pertaining to the letting of residential premises
- a tenancy which automatically renews itself on the last day of the term for a further term of the same duration until terminated be either party
- expires at the end of the term only if the landlord and tenant agree in writing at outset of if “proper” notice of the end of the tenancy agreement is given.
A
- a tenancy where the tenant, with the consent of the landlord, occupies land as a tenant for a term which can be terminated by either party at any time
18
Q
Joists are:
- Horizontal structural framing members that support floors and ceilings
- Trusses that support the roof deck
- Beams the support walls and floors
- Made of plywood and cover the walls under the siding
A
- Horizontal structural framing members that support floors and ceilings
19
Q
Which of the following statements is TRUE in regards to open listing?
- An open listing provides better protection to the agent then exclusive listing.
- In an open listing contract, If the seller disposes of the property to a prospect that was not introduced by any of the listing agents, the seller does not pay listing agents a commission.
- While a listing contract is a contract between the brokerage and the seller, the buyer is bound to some of the terms contained in the contract.
- It is not necessary that an exclusive listing contains a specified duration and a commencement date.
A
- In an open listing contract, If the seller disposes of the property to a prospect that was not introduced by any of the listing agents, the seller does not pay listing agents a commission.
20
Q
Which of the following statements with respect to the contract is TRUE:
- Frustration can only occur after a contract has been made.
- If a contract is entered into as the result of a person in a power using his or her position to induce a weaker party to enter a contract would not have otherwise made, the contract will be frustrated.
- Frustration occurs where both parties to a contract have made a fundamental mistake about the contract, but each makes a different mistake.
- Frustration will apply if the subject matter of the contract is destroyed before the contract is made.
A
- Frustration can only occur after a contract has been made.
21
Q
Which one of the following statements is TRUE?
- The doctrine of precedent does not provides uniformity to the common law system
- The Supreme Court of Canada is required to hear all appeals.
- The Supreme Court of British Columbia may exercise both common law and equitable jurisdiction.
- An appeal by a taxpayer to reduce a tax assessment would fall within the sphere of private law.
A
- The Supreme Court of British Columbia may exercise both common law and equitable jurisdiction.
22
Q
Which one of the following statements best describes the difference between an assessment notice and a tax notice?
- A tax notice is a demand for payment while an assessment notice is not
- Both notices are demands for payment, but a tax notice also provides a breakdown of the tax systems
- Neither statement is a demand for payment; they both inform the owner of the assessed value of his property
- An assessment notice is used to supplement the assessment roll
A
- A tax notice is a demand for payment while an assessment notice is not
23
Q
Which of the following statements with respect to the doctrine of frustration is TRUE?
- Frustration can only occur after the contract is made
- If a contract is entered into as the result of a person in a superior position to induce a weaker party to enter a contract which he or she wouldn’t otherwise have wanted to be in, the contract would be frustrated
- Frustration occurs where both parties to a contract have made a fundamental mistake but each mistake is different
- Frustration will apply if the subject matter of the contract is destroyed before or after the contract is made
A
- Frustration can only occur after the contract is made
24
Q
Which of the following statements regarding conditions in a contract are TRUE?
A. A condition is a promise which is not fundamental to the contract
B. In most cases, the breach of a condition permits the innocent party to terminate the contract
C. A “time is of the essence” clause indicates that timely performance is a condition of the contract
D. If a term is not a condition, then a breach of that term will not result in any remedies for the innocent party.
A and C only
A and D only
B and C only
C and D only
A
B and C only
25
Which of the following statements is FALSE?
1. An agency relationship is created when two persons agree that one will act on behalf of the other
2. An agent who does not disclose to a third party that he or she is she is an agent and enters into a contract with a third party may be held liable as a principal.
3. An agency agreement must be written to be enforceable.
4. The agent can never escape liability for torts committed by the agent on the basis that the agent was authorized by the principal to commit them
3. An agency agreement must be written to be enforceable.
26
The agency contract that specifies that the real estate agent has the right to negotiate on behalf of the owner with respect to the sale of property, is called:
1. An exclusive listing
2. An absolute listing
3. A general listing
4. A select listing
1. An exclusive listing
27
You have a partially completed appraisal report that you need to fill in. The 2,200 square foot subject property has 4 bedrooms and 4 bathrooms. The house next door is similar in all respects except for square footage, the number of bedrooms, and the number of bathrooms. The 2,300 square foot comparable sold for $245,000 and has 3 bedrooms and 3 bathrooms. If the market value of a bedroom is $4,000, the market value of a bathroom is $5,700, and above a 1,900 sq. ft. benchmark, each 100 sq. ft. is worth $6,000, the adjusted sale price for this comparable is:
$248,700
$260,700
$229,300
$241,300
$248,700
28
The loan to value ratio is the ratio of:
1. the annual payments on the loan divided by the market value of the mortgage.
2. the actual amount of the mortgage (the amount paid to the borrower net of bonus or brokerage fees) divided by the actual value of the property.
3. the market value of the mortgage divided by the market value of the property.
4. the face value of the mortgage loan divided by the lending value of the property.
4. the face value of the mortgage loan divided by the lending value of the property.
29
Which of the following statements about trust accounts under the Real Estate Services Act is true?
1. Money paid by mistake into a trust may be withdrawn from the trust account without both parties agreement
2. All clients funds must be placed in the trust account as soon as they are received by the Brokerage
3. A Brokerage must have a separate trust account for each client
4. Only the portion of the money received on behalf of a client can be reimbursed from the trust account
2. All clients funds must be placed in the trust account as soon as they are received by the Brokerage
30
Elvin is purchasing Jeremy’s beach house in Tofino. Elvin having a difficult time getting enough financing, so he decided to give Jeremy his boat, valued at $21,000. Furthermore, he will be assuming Jeremy’s existing mortgage on the property. Elvin just paid deposit of $30,000 directly to Jeremy. Which of the following items will appear EITHER debit or credit on Jeremy’s statement of adjustment?
1. Purchase price, property transfer tax, cash proceeds of sale
2. Real Estate licensee’s commission, sale price, conveyance fees
3. Deposit, assumption of the first mortgage, real estate commission
4. Boat trade, deposit, property transfer tax
3. Deposit, assumption of the first mortgage, real estate commission
31
A promise between the Buyer and the Seller known as:
1. Consideration
2. Warranty
3. Offer
4. Consent
3. Offer
32
Which one of the following does NOT facilitate best negotiation principles:
1. Framing the discussions around objective standards
2. Focusing on stating and defending the position of each party
3. Asking the other party exactly why they want what they want
4. Being creative with the generation of ideas
2. Focusing on stating and defending the position of each party
33
Canada’s Competition Act regards false or misleading advertisement
Which of the following is FALSE concerning the offense?
1. Both the general impression of the representation as well as its literal meaning are relevant in determining whether a breach of the Act has taken place.
2. This offense includes both oral and written representations made to the public.
3. To escape liability, the accused must show that he or she took all the care that is a reasonable person would have taken to determine if the representation was true and that the accused, honestly believed it to be true.
4. One test that the courts use to determine whether a statement is misleading in the context of real estate licensees is the “ diligent licensee” test.
4. One test that the courts use to determine whether a statement is misleading in the context of real estate licensees is the “ diligent licensee” test.
34
734. You have a partially completed appraisal report that you need to fill in. The 2,500 square foot subject property has an alarm system. The house next door is similar in all respects except for the square footage and alarm system. The 2,700 square foot comparable sold for $236,500 and does not have an alarm system. If the market value of an alarm system is $4,500 and, above a 2,000 sq. ft. benchmark, each 100 sq. ft. is worth $6,000, this comparable will have to be adjusted for an alarm system and square footage by:
$0 and -$6,000 respectively.
-$4,500 and +$6,000 respectively.
$0 and +$12,000 respectively.
+$4,500 and -$12,000 respectively.
+$4,500 and -$12,000 respectively.
35
The practice of recognizing expenses as they are incurred, rather than when they are paid for, is a characteristic of:
1. the cost principle.
2. the recognition principle.
3. the matching principle.
4. the conservation principle.
3. the matching principle.
36
A balloon payment is any payment of:
1. interest over and above regular interest payments, but only when it occurs during the term of the loan
2. principal over and above the regular payments, whether it occurs during or at the end of the loan term
3. principal over and above the regular periodic payments, but only when it occurs at the end of the loan term
4. interest over and above regular interest payment, whether it occurs during or at the end of the loan term
2. principal over and above the regular payments, whether it occurs during or at the end of the loan term
37
Which of the following would appear as a debit on the seller’s statement of adjustment?
1. The amount of mortgage which the buyer will assume
2. The legal fees involved to discharge a judgment from the seller’s title
3. The amount of penalty owing for overdue taxes
4. All of the above would appear as a debit on the seller’s statement
4. All of the above would appear as a debit on the seller’s statement
38
Bonused mortgages are subject to specific legal requirements under the provisions of:
1. Interest Act
2. Consumer Protection Act
3. Mortgage Act
4. Mortgage Broker Act
2. Consumer Protection Act
39
On December 21, Kate received an offer from Justin to buy Kate’s house for $249,000. The offer also stated that it would be open for acceptance until 11 am, December 31. Which of the following statements is TRUE?
1. Justin cannot revoke his offer because he has promised that he will buy it by
certain time.
2. Justin offer represents an option agreement.
3. If Kate makes a counter-offer for $250,000 and Justin rejects it, Kate may sue him for damages.
4. If Kate makes a counter-offer, Justin’s offer is terminated.
4. If Kate makes a counter-offer, Justin’s offer is terminated.
40
Which one of the following is NOT one of the legislated obligations imposed on a strata corporation under the Strata Property Act?
1. The obligation to exercise the powers and perform the duties of the strata corporation.
2. The obligation to obtain and maintain property insurance of the common property
3. The obligation to prepare certain records such as minutes of annual and special general meetings and council meetings
4. The obligation to manage the common property and common assets of the strata corporation for the benefit of the owners.
1. The obligation to exercise the powers and perform the duties of the strata corporation
41
A lease for real estate property is a contract by which the landlord grants:
1. An assignment to the tenant
2. Exclusive possession to the tenant
3. A license to occupy to the tenant
4. None of the above
2. Exclusive possession to the tenant
42
You have promised to pay your friend $10,000 four years from today. What is the present value of this $10,000, if the effective rate is 6%?
1. $9,786.00
2. $7,920.94
3. $12,624.77
4. $8,398.93
2. $7,920.94
43
An estimate of gross potential rents is achieved by:
1. comparing all rents for similar spaces.
2. comparing rents for recently leased similar spaces.
3. projecting future rental increases.
4. totaling current rents in the subject building.
2. comparing rents for recently leased similar spaces.
44
Which of the following statements regarding property appraisal is FALSE
1. the courts have recognized that a reasonable margin of error exists when calculating damages resulting from a negligent appraisal
2. The value of real property can always be established with certainty
3. A large over-valuation of property by an appraiser does not, by itself, establish liability on the part of the appraiser
4. The courts provide some guidelines as to an appraiser’s legal responsibilities that are outlined in the law of contract and the law of tort.
2. The value of real property can always be established with certainty
45
Which of the following is NOT a consideration of planners based on local government’s planning process?
1. The testing of alternate courses of action.
2. The forecasting of future requirements or trends.
3. The establishing of long and short-term goals,
4. The enforcement of the bylaws of a given local government.
4. The enforcement of the bylaws of a given local government.
46
Which one of the following is NOT one of the legislated obligations imposed on a strata corporation under the Strata Property Act?
1. The obligation to keep the common property in a state of good and serviceable repair
2. The obligation to maintain liability insurance of no less than $5,000,000 on the strata project
3. The obligation to establish a contingency reserve fund for unusual or extraordinary expenses
4. The obligation to establish a fund for payment of administrative expenses of the strata corporation
2. The obligation to maintain liability insurance of no less than $5,000,000 on the strata project
47
Real Estate is effected by a wider and more serious range of externalities the any other commodity. It’s because of:
1. Rapid development of real estate property in highly populated area
2. Divisibility of ownership, both physically and legally
3. Durability of real estate property
4. Immobility of real estate property
4. Immobility of real estate property
48
Which of the following statements about federal legislation governing mortgage interest rate is FALSE?
1. The Interest Act provides that if a mortgage agreement requires interest payments but does not specify the rates of interest payable, then the effective rate allowed by law is 5%
2. The Criminal Code defines a criminal rate of interest as an effective annual rate in excess of 60%
3. Section 10 of the Interest Act provides an individual with the right of prepayment of his or her outstanding mortgage at the expiry of a five year term or not payable for more then 5 years from the date of the mortgage for the borrower
4. The Interest Act allows borrowers the right to attack the rate of interest being charged on a mortgage
3. Section 10 of the Interest Act provides an individual with the right of prepayment of his or her outstanding mortgage at the expiry of a five year term or not payable for more then 5 years from the date of the mortgage for the borrower
49
Which of the following statements are TRUE?
A. An agency relationship is created when two parties agree that one will act on behalf of the other
B. When the agent does not disclose that he or she is an agent and gets into a contract with a 3rd party, the principal will not be liable for the contract
C. An infant can act as an agent
D. An agency agreement must be written to be enforceable
B and D
A and B
A and C
C and D
3. A and C
50
Which of the following statements is TRUE with respect to common law duress?
1. To successfully claim law duress, the innocent party has to prove that she was physically harmed by the other party.
2. A finding of common law duress will automatically void the contract
3. To successfully claim common law duress, the innocent party that the contract is substantially unfair.
4. A finding of common law duress will result in the contract being voidable by the party that was robbed of the free will to contract.
4. A finding of common law duress will result in the contract being voidable by the party that was robbed of the free will to contract.
51
The decisions of a disciplinary committee:
1. Must be issued orally, and specify ant discipline imposed.
2. Must be issued both orally and in writing, and specify any discipline imposed.
3. Must be in writing, and specify any discipline imposed.
4. Must be in writing, but need not specify any discipline imposed.
3. Must be in writing, and specify any discipline imposed.
52
One of more of the following statements describing the BC land registration system is TRUE
A. Documents transferring a fee simple title must be registered to be in effect and enforceable against subsequent bona fide purchasers of the same fee simple.
B. A charge registered against a fee simple title may be removed from the title if it is a forged document.
C. The Assurance Fund will compensate every financial loss incurred as a result of BC’s land registration system regardless of the cause of the loss.
D. Unless the Land Title Act specifies the use of a particular form, any instrument sufficient to pass or create an estate or interest in land is registrable.
1. Only A is true
2. Only C and D are true
3. Only A, C and D are true
4. Only A, B and D are true
4. Only A, B and D are true
53
The promotional Mix is a blend of:
1. publicity, sales promotion, public relations, advertising and personal selling
2. product, price, personal appearance, public relations and sales promotions
3. product, niche marketing, public relations, pricing and personal marketing
4. product, price, place and personal appearance
1. publicity, sales promotion, public relations, advertising and personal selling
54
Which of the following factors is MOST likely to affect the value of residential real property in the short run?
1. consumer pessimism and optimism relating to residential real estate trends
3. the supply and cost of raw materials
3. government programs effecting real estate
4. shifts in age composition of the population
1. consumer pessimism and optimism relating to residential real estate trends
55
Jordan is a fee simple owner of a large rural property in BC. He is considering one of the following actions:
A. Suing a pilot for trespass after he harmlessly flies his small plane over Jordan’s property
B. Building a dam in the bed of a large river that flows through his property
C. Draining part of the lake that borders his property
D. Extracting and selling coal found under his property
Which activities, if any, does Jordan legally have the right to perform?
Only A
Only B and C
Only C and D
Jordan may not legally perform any of the listed activities
Jordan may not legally perform any of the listed activities
56
Which of the following is an accurate statement about principle of indefeasibility?
1. The principle of indefeasibility operates on the basis that registered owner on title provides conclusive evidence of that person’s entitlement to the fee simple estate.
2. The principle of indefeasibility means that in no circumstances may the purchaser be set aside, even by the claims of a previous rightful owner
3. if a registered owner loses an interest in land due to the principle of indefeasibility he or she will automatically qualify for compensation from the assurance fund
4. the principle of indefeasibility extends to all validly registered charges on the title.
1. The principle of indefeasibility operates on the basis that registered owner on title provides conclusive evidence of that person’s entitlement to the fee simple estate.
57
A mortgage loan has a face value of $250,000, an interest rate of 3.5 per annum, compounded semi-annually. Amortization period of 20 years, a term of 3 years and accelerated biweekly payments, rounder up to the next higher dollar.
The amount of the accelerated biweekly payments will be?
$668.00
$1,447.00
$724.00
$1,336.00
$724.00
58
Buyer and Seller entered into a building contract of purchase and sale of the seller’s townhouse. Shortly before the completion date, the buyer, regretting her decision to purchase the townhouse and informs the seller that she will not complete the sale. The Seller decides to initiate a court proceeding against the buyer, what damages would court likely receive?
1) out –of-pocket expenses incurred in reselling the house
2) Provided that the seller can demonstrate that he exercised reasonable efforts to sell the townhouse, and can ask for the difference in contract prices if the second sale was for a lower price.
3) Quantum meruit
4) . Both (1) and (2)
4). Both (1) and (2)
59
The Anchoring Effect is:
1. to be avoided at all times in negotiations
2. a useful tool for encouraging movement away from stated price
3. a psychological phenomenon whereby negotiators make insufficient adjustments away from stated number
4. an objective standard that is agreed upon by both parties
3. a psychological phenomenon whereby negotiators make insufficient adjustments away from stated number
60
The Big Shoe company pays $15,500 for an asset which the income Tax Act allows a capital cost allowance of 4% per a year. The asset is expected to have a useful life of 10 years and will have a salvage value of 1,500. Calculate the depreciation expense for accounting purposes for the asset’s 5th year if the accountant chooses to use straight-line depreciation
1. $6,020
2. $1,656
3. $1,400
4. $1,565
3. $1,400
61
If a negotiator recognizes that the other negotiator is using dirty tactics, he should:
1. Use a similar tactic in return to prove that he is a better negotiator
2. Ignore the tactics and proceed with the negotiation
3. Raise the issue with the other negotiator and argue against it, if needed
4. Raise his or her demands, in response to the dirty tactics, with similar behavior
3. Raise the issue with the other negotiator and argue against it, if needed
62
Which of the following statements regarding loan to value ratio and landing value are TRUE?
A. Lending value is a long-term conservative estimate of the value pledged as security.
B. Lending value is an estimate of the mortgage loan a purchaser will be able to obtain.
C. The maximum loan-to-value ratio is set by statue as 80% for federally chartered financial institutions unless the mortgage is insured.
D. A loan-to-value ratio that is higher than the competitor’s will drive the lending activity to other lenders.
Only statements B and D are true
Only statements A and C are true
Only statements A, C and D are true
Only statements A, B, and D are true
Only statements A and C are true
63
Michelle, on her way home from work, noticed that the neighbour’s house is for sale. Michelle has always liked this property which was located on the quiet street and backs onto a wooden area. Michelle decided to go ask the owners for the price. As she walked across the lawn, a tree branch fell down and hit her. As a result, she broke her arm and couldn’t go back to work for two months. Which one of the following statements is FALSE?
1. Michelle can sue the owners of the property for her lost wages only if she can prove that they were previously aware of the hazard presented by the old tree.
2. Even though Michelle was not invited onto the property by the owners, the owners owe a duty of care to her
3. The BC Occupiers Liability Act governs in this case and sets out the duty of care owed by an occupier.
4. The BC Occupiers Liability Act has replaced the common law rules governing Occupier’s liability in BC.
1. Michelle can sue the owners of the property for her lost wages only if she can prove that they were previously aware of the hazard presented by the old tree.
64
Which of the following statements are TRUE?
A. Licensees must ensure that when the listing get expired to remove It immediately from the website (s)
B. The name of the brokerage does not need to be included on your website.
C. Listing information should be kept current and accurate.
D. Websites must be reviewed for currency at least once per week.
Only A and B
Only B and D
Only A and C
Only B and C
Only A and C
65
Which of the following statements about Real Estate brokerages are TRUE?
1. Under an exclusive listing conferring an exclusive right to sell, the seller reserves the right to sell the property himself or herself and does not have to pay commission to the brokerage in those circumstances
2. Under a multiple listing, the listing is distributed to all co-operating members of real estate.
3. Under an open listing, the consideration for the owner’s promise to pay a commission is the brokerage’s promise to use best efforts to locate a ready, willing, and able purchaser
4. Where a listing agreement provides for the payment of the commission to the brokerage regardless of whether the brokerage brings about the sale, the seller can avoid paying commission because the courts will not enforce such clause.
3. Under an open listing, the consideration for the owner’s promise to pay a commission is the brokerage’s promise to use best efforts to locate a ready, willing, and able purchaser
66
If were to become a limited partner in a business, you would need to know that:
1. limited partners may still take part in the day-to-day operations of the partnership
2. limited partners can actively be engaged in managing the business without any consequence to his
or her partnership status.
3. limited partners have their liabilities to creditors limited to the amount of money they have invested in the business
4. limited partners are not involved in day-to-day operations of the business are taxed at a lower rate than general partners with respect to dividend distribution
3. limited partners have their liabilities to creditors limited to the amount of money they have invested in the business
67
When setting a target market, a good negotiator would:
1) Set a resistance point that effects the sale
2) Set an aspiration target that represents the best scenario
3) Set your expectations low
4) Both (1) and (2)
4) Both (1) and (2)
68
When a licensee searches for the title of a property, which of the following will show and be noted on the title?
A. Joint tenancy
B. An easement
C. Restrictive covenant
D. A building Scheme
B only
B and C only
A only
All of the above
All of the above
69
Which of the following is NOT an example of a residential agreements that Tenancy Act would apply?
1. Carla is a school teacher in northern British Colombia. She lives in a small house owned and rented to teachers by the Church organization which operates the program which she teaches.
2. Jim and his wife Helen are caretakers on a large estate on Vancouver Island. They live in double wide manufactured home owned by their employer and located a the hill on the private road that runs through the estate.
3. Mandy is an art student who rents a bedroom in a Victorian style house for $200 a month. Victor, the owner, rents out the 7 bedroom to students and lives in the basement himself.
4. Bob leases a small warehouse in which he operates his computer business. The top floor of the warehouse contains a 3 room apartments that Bob lives.
4. Bob leases a small warehouse in which he operates his computer business. The top floor of the warehouse contains a 3 room apartments that Bob lives.
70
A “periodic” tenancy is:
1. Automatically renews itself on the last day of the term for a further term of the same length.
2. A lease with no predetermined expiry date
3. A type of fixed term lease
4. A lease that has a predetermined expiry date
1. Automatically renews itself on the last day of the term for a further term of the same length.
71
Your friend recently took a marketing course and mentioned the four P’s of marketing.
The 4 P’s of marketing are also called:
1. Product, place, price and positioning
2. the communications mix
3. product, price, place and publicity
4. the marketing mix
4. the marketing mix
72
The purpose of a code of ethics is to:
A. defend a minimum standard of conduct for professionals
B. maintain the reputation of the profession in the eyes of the public.
C. set out remedies for the profession through the courts to the people.
D. replace the rigidity of the legal system for professionals.
1. only A
2. only B
3. C and D only
4. All of the above
2. only B
73
Which of the following documents are regulated by the land title office in order for legal title to be transferred from seller to buyer?
1. Income Tax returns
2. A Title Search Certificate
3. A Freehold Transfer
4. A statement of adjustments for each of the buyer and seller
3. A Freehold Transfer
74
The Errors and omission Indemnity Plan cover which of the following:
1. Acts performed by a licensee that causes bodily injury to a person
2. Fraudulent acts committed by the licensee on the course of business practice
3. Negligent acts committed by the licensee in the course of his or her real estate practice.
4. All of the above
3. Negligent acts committed by the licensee in the course of his or her real estate practice.
75
You are taking a client through ahouse that was built in 1930. You noticed that the electric plugs in this home have only two holes in them. This is known as:
1. Fiber optic wiring
2. Aluminum wiring
3. Fused wiring
4. Knob and tube wiring
4. Knob and tube wiring
76
While the provincial government has delegated most of the duties to the local governments, there are certain controls imposed directly by the provincial governments.
Which of the following statues is an exercise of the provincial governments?
1. The Heritage Conservation Act
2. The Environmental Management Act
3. The Health Act
4. All of the above
4. All of the above
77
A Strata Council wishes to hold an annual meeting and is unclear about how to give sufficient notice of the meeting. They have approached you with a list of options that they are currently considering. Which of the following options is NOT sufficient notice of an annual general meeting?
A) A notice emailed 7 days prior to the meeting
B) Verbal notice given 20 days prior to the meeting
C) 10 days notice if 20% of strata corporation has demanded in writing that they hold a special general meeting under EGM
D) Notice left under the doors of its residents
1. Only A and B
2. Only B and C
3. Only B, C and D
4. A, B, C and D
4. A, B, C and D
78
Which of the following appear as debits on a Buyer’s statement of adjustments?
1. vender take-back mortgage, conveyancing fees
2. deposit paid, real estate licensee’s commission, legal fees for discharge of existing mortgage
3. assumption of 1st mortgage, deposit paid, balance due to complete
4. conveyancing fees, purchase price
4. conveyancing fees, purchase price
79
Electric Baseboard heaters are a common example of:
1. Electrostatic heating
2. Convection heating
3. Distributive heating
4. Forced heating
2. Convection heating
80
Which of the following statements regarding generally accounting principles are FALSE?
A. The materiality principle holds that changes to accounting principle should only be made when the change results in providing more relevant and useful information to the user of the financial statements.
B. The consistency principle is closely aligned to the cost principle because the best way to ensure objectivity in accounting transaction is to record the amount of consideration given up at the date of the transaction.
C. To conform with the cost principle, it is not appropriate to record the asset at what might be considered its fair market value, the asset should be recorded at the amount that the enterprise paid for it.
D. The matching principle requires the accrual basis of accounting, that is, expenses are always incurred, which is not necessary when they are paid.
1. Only statements A and D are false
2. Only statements C and D are false
3. Only statements A and B are false
4. All of the above statements are false
3. Only statements A and B are false
81
the loss in value caused by outmoded or inadequate design in building is:
1. Physical depreciation
2. Functional depreciation
3. Capital value allowance
2. Functional depreciation
82
Which one of the most important features of an energy efficient house?
1. Only uses wood burning fireplaces and stoves.
2. Only faces north in order to take advantage of solar heating
3. Has a draft-free building envelope.
4. Has a single glazed thermal windows.
3. Has a draft-free building envelope.
83
Which one of the following factors is MOST likely to affect the value of residential real property in the short run?
1. Consumers pessimism or optimism relating to residential Real Estate trends.
2. The supply and cost of raw materials and energy.
3. Government programs about Real Estate.
4. Shifts in age composition of the population.
1. Consumers pessimism or optimism relating to residential Real Estate trends.
84
A Seller just agreed to sell her home to a Buyer and is packing her belongings and getting ready to move out. Which of the following items can she most likely take with her?
1. her built-in counter top stove
2. her television, which is mounted onto the wall in the living room
3. the laminate flooring that was installed on her kitchen one month ago
4. the expensive faucets in her bath tub in the master bedroom
2. her television, which is mounted onto the wall in the living room
85
Which of the following statements regarding the comparative method of appraisal is TRUE?
1. The comparative method of appraisal should be used for a property that possesses latent value
2. To apply the comparative method of appraisal, the appraiser estimates the market value of the subject property using as evidence the sale prices of similar properties which were sold at any time prior to the appraisal
3. The comparative method of appraisal is the most inexact approach for finding market value since cost and market value are not necessarily equal at any particular time
4. The comparative method reflects market behavior and requires a minimum of subjective opinion from the appraiser
4. The comparative method reflects market behavior and requires a minimum of subjective opinion from the appraiser
86
The term “mandatory injunction” is defined as”
1. A common law remedy of monetary damages
2. An equitable remedy whereby of a course orders a change in the written document.
3. An order requiring a defendant to do a particular thing
4. An order summoning a defendant to appear in court
3. An order requiring a defendant to do a particular thing
87
Which of the following statements is FALSE?
1. So long as the effect is negative, positive words may be used in the document.
2. Restrictive covenants must be intended to run with the land.
3. A restrictive covenant will be presumed to be released if there has been temporary inconsistency with it.
4. Significant changes to the character of a neighborhood may render a restrictive covenant unenforceable.
3. A restrictive covenant will be presumed to be released if there has been temporary inconsistency with it.
88
Which of the following contractual clauses in a mortgage will not apply when the borrower defaults?
1. A “lender’s remedies” clause
2. A “sales” clause
3. An “acceleration” clause
4. A “mortgage in possession” clause
2. A “sales” clause
89
Which answer most accurately describes an official community plan (OCP)?
1. An official community plan is a policy statement regarding the planning of a community which, when adopted by law, must be carried out in every detail by the council.
2. When a local government officially adopts a community plan, existing zoning bylaws which do not conform are suspended and land owners' rights are then directly subject to the official community plan.
3. An official community plan is a plan which a regional district board has designed and adopted for one of its member municipalities, regardless of the views of the council of the municipality in question.
4. A community plan defines the policy of a local government in terms of existing and proposed land use and servicing requirements and contains specific policies in that regard
4. A community plan defines the policy of a local government in terms of existing and proposed land use and servicing requirements and contains specific policies in that regard
90
Which of the following steps is part of the “pleading” process:
1. response to a civil claim
2. conducting discovery proceedings
3. enforcing a judgment
4. writ of Execution
1. response to a civil claim
91
An appraiser using the comparative method of the appraisal and who is estimating a single-family house can use sale prices of the following comparative properties EXCEPT:
1. Houses in different neighborhoods
2. Houses recently sold between relative parties
3. Houses with different square footage
4. Houses sold over three months ago
2. Houses recently sold between relative parties
92
Which of the following statements is FALSE with respect in regards to an agent?
1. An infant may act as an agent
2. One additional limitation on the capacity of real estate agents, as opposite to common law for other industries, is that they must also be licensed under the Real Estate Services Act.
3. Because the agent represents a party to a contract, to bind the principal and the agent also have the capacity to contract on his or her own behalf.
4. None of the above-mentioned statement
3. Because the agent represents a party to a contract, to bind the principal and the agent also have the capacity to contract on his or her own behalf.
93
Where a deposit paid directly to a seller on account of the purchase price:
1. The amount of deposit will appear as a credit to the buyer and the debit on the seller’s statement.
2. The amount of deposit will appear only on the seller’s side statement of adjustment
3. The amount of the deposit will appear as a debit on the buyer’s statement and a credit to the seller
4. The amount of the deposit will appear in the same column as the purchase price on the sellers statement
1. The amount of deposit will appear as a credit to the buyer and the debit on the seller’s statement.
94
The term ‘security” is used in the mortgage lending usually refers to:
1. . The interest in land given by the borrower to assure that lender… under the mortgage will be repaid
2. The amount advanced under the loan.
3. The documentation used in a mortgage transaction.
4. The ability of the lender to make an application to a court to foreclose on the property in the event of the default.
1.. The interest in land given by the borrower to assure that lender… under the mortgage will be repaid
95
Which one of the following does NOT form part of the definition of market value?
1. Value is a price that is reasonably expected to prevail.
2. Value is based on the personal opinion of the value to the owner.
3. Value is determined at a particular point in time.
4. The buyer and seller must be bargaining at arm’s length.
2. Value is based on the personal opinion of the value to the owner.
96
Precedents form a major part of the common law system. Another major source of our law is legislation. Which of the following could be called “legislation”?
1. the Land Title Act
2. the Principle of Specific Performance
3. the Equity of Redemption
4. all of the above
1. the Land Title Act
97
A local builder negotiates on an interest-only loan for $445,000, the interest rate is 7%, compounded daily. The loan was given for 2 years, and the interest-only payments are to be made monthly. How much is the interest only payments?
$2,614.00
$2,558.77
$2,595.84
$2,603.17
$2,603.17
98
Which of the following are advertising contraventions for which a penalty may be imposed by the Real Estate Council (RECBC)?
A. failure to have a team name registered and approved by the RECBC for the advertising proposes
B. Failure to have all advertising materials approved by the RECBC for the advertising purposes.
C. Failure to display the name of a licensee’s brokerage on an advertisement in an easily readable way.
D. Displaying signage that real estate services are provided from a licensee personal home office.
1. Only statement A
2. Only statement B and C
3. Only statement A, C, and D
4. All of the above
3. Only statement A, C, and D
99
Which of the following would appear as CREDITS on the buyer’s statement of adjustment
1. Existing first mortgage being assumed by the buyer; sellers share of taxes not due yet; penalty due on overdue taxes.
2. Deposit paid into the brokerage’s trust account, legal fees for conveyancing agreement for sale.
3. Tenant’s security deposit, legal fees for discharging the existing mortgage, new first mortgage proceeds arranged by the buyer.
4. Deposit paid directly by the buyer to seller, seller’s share of taxes not yet due; the existing first mortgage being assumed by the buyer.
4. Deposit paid directly by the buyer to seller, seller’s share of taxes not yet due; the existing first mortgage being assumed by the buyer.
100
Which of the following is NOT an example of a breach of the criminal conspiracy code in restraint of trade, section 45(1), of the Competition act
1. An agreement among licensees to fix minimum commission rates on real property transactions.
2. An agreement between real estate boards to exclude membership of brokerages to a maximum number of member brokerages has been reached.
3. An agreement among licensees to advertise their services as “the best in the world”.
4. An agreement among real estate brokerages to allocate markets to certain licensees.
3. An agreement among licensees to advertise their services as “the best in the world”.
