Appraisal highest and best use

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LAMERBOI
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Appraisal highest and best use
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2012-12-16 23:57:47
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Appraisal
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Chapter 4-7 test
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  1. Changes in the market in a consistent direction that occur over a long-term period.
    A. trends
    B. cycles
    C.market system
    D. business cycle
    A. trends
    (this multiple choice question has been scrambled)
  2. Periodic, irergular up-and-down movements in economic activity that take place over a period of two to six years
    A. trends
    B. cycles
    C. business cycle
    D. market system
    B. cycles
    (this multiple choice question has been scrambled)
  3. Changes in business and economic activity that occur with the year
    A. expansion phase
    B. peak phase
    C. fluctuation
    D. short-term fluctuation
    D. short-term fluctuation
    (this multiple choice question has been scrambled)
  4. Sequence of four phases: recovery, expansion, stability, and contraction
    A. business cycle
    B. cycle
    C. fluctuation
    D. short-term fluctuation
    A. business cycle
    (this multiple choice question has been scrambled)
  5. Phase at the bottom of the real estate cycle
    A. expansion phase
    B. recession
    C. illiquid
    D. recovery phase
    D. recovery phase
    (this multiple choice question has been scrambled)
  6. Phase marked by higher demand than supply and increasing prices
    A. recovery phase
    B. recession
    C. expansion phase
    D. peak phase
    C. expansion phase
    (this multiple choice question has been scrambled)
  7. The study of the allocation of scarce resources
    Economics
  8. Economic system in which the allocation decisions are relegated to buyers and sellers
    A. submarket
    B. market segmentation
    C. market system
    D. efficient market
    C. market system
    (this multiple choice question has been scrambled)
  9. A market in which goods and services are easily produced and readily transferable
    A. submarket
    B. imperfect market
    C. efficient market
    D. market system
    C. efficient market
    (this multiple choice question has been scrambled)
  10. Market that cannot meet the requirements for a perfect market
    A. submarket
    B. imperfect market
    C. economy market
    D. market system
    B. imperfect market
    (this multiple choice question has been scrambled)
  11. An asset that cannot be readily converted to cash.
    A. U.S Dollars
    B. illiquid
    C. Euro
    D. checks
    B. illiquid
    (this multiple choice question has been scrambled)
  12. Process of identifying and analyzing submarkets within larger markets
    A. inefficient submarket
    B. imperfect market
    C. market segmentation
    D. market division
    C. market segmentation
    (this multiple choice question has been scrambled)
  13. Geographic, economic, or specialized subdivision of a market
    A. efficient market
    B. submarket
    C. market system
    D. short-term market
    B. submarket
    (this multiple choice question has been scrambled)
  14. The international reserve currency or U.S. dollars used to purchase oil from OPEC countries
    A. Euro
    B. Petrol dollars
    C. U.S Dollar
    D. International dollars
    B. Petrol dollars
    (this multiple choice question has been scrambled)
  15. Currency used by 13 countries in the European Union
    Euro
  16. Economic changes occur as:
    a. trends
    b. cycles
    c. fluctuations
    d. all of the above
    d. all of the above
  17. In a business cycle, the economy ____ during expansion and ____ during contraction
    A. slows down / slows down
    B. speeds up / slows down 
    C. speeds up / speeds up
    D. slows down / speeds up
    B. speeds up / slows down 
    (this multiple choice question has been scrambled)
  18. Which statement is incorrect regarding real estate cycles
    A. Each market is impacted by economic, financial, and demographic factors.
    B. Real estate cycles exist in residential property markets
    C. Real estate cycles exist in commercial property markets
    D. Submarkets do not experience real estate cycles
    D. Submarkets do not experience real estate cycles
    (this multiple choice question has been scrambled)
  19. Increasing demand creates a need for more properties during the ___ phase
    A. expansion
    B. recovery
    C. contraction
    D. peak
    A. expansion
    (this multiple choice question has been scrambled)
  20. The real estate market is a(n) ____ market
    A. imperfect
    B. efficient
    C. organized
    D. perfect
    A. imperfect
    (this multiple choice question has been scrambled)
  21. Typical submarkets for resdential properties include
    A. perfect
    B. single-family homes
    C. efficient
    D. condominiums
    A. perfect
    (this multiple choice question has been scrambled)
  22. Retail space submarkets include all of the following, except:
    A. resorts
    B. outlet malls
    C. regional malls
    D. strip center
    A. resorts
    (this multiple choice question has been scrambled)
  23. Class A, Class B, and Class C refer to:
    A. locational adjustments
    B. commodities markets
    C. quality for construction
    D. water purity
    C. quality for construction
    (this multiple choice question has been scrambled)
  24. An industrial market can be segmented into which of the following submarkets?
    a. factories and warehouses
    b. access to rail systems and highways
    c. owner-operated or investor-owned
    d. all of the above
    d. all of the above
  25. Sometimes, foreign investment can:
    a. artificially increase market values
    b. distort selling prices
    c. cause a bidding war
    d. do all of the above
    d. do all of the above
  26. What causes an imbalance of trade?
    A. Government stability
    B. Teh availability of low-cost real estate for sale in the United State
    C. lack of petrol dollars
    D. U .S consumers buying more goods from countries whose citizens buy less U.S goods
    D. U .S consumers buying more goods from countries whose citizens buy less U.S goods
    (this multiple choice question has been scrambled)
  27. When the U.S. dollars is weak compared to the Euro, it is advantageous for Euro holders to:
    A. purchase U.S products
    B. refrain from purchasing goods from the United States
    C. buy real estate in the United States
    D. Buy real estate in the United States, and purchase U.S products.
    D. Buy real estate in the United States, and purchase U.S products.
    (this multiple choice question has been scrambled)
  28. Which of the following statements is true regarding the availability of financing in the United States?
    A. The US has been a world leader int he availability of financing
    B. The US does not offer long-term, fixed-rate financing
    C. The US lacks the access to financing compared to other countries
    D. Historically, it has been difficult to obtain financing in the US
    A. The US has been a world leader int he availability of financing
    (this multiple choice question has been scrambled)
  29. Ultimately, what is the effect of foreign countries seeking to own properties in the United States?
    A. higher real estate prices
    B. less potential buyers of real estate
    C. lower real estate prices
    D. decreased competition to purchase real estate
    A. higher real estate prices
    (this multiple choice question has been scrambled)
  30. Typical submarkets in an agricultureal market would include:
    A. quality of construction materials
    B. orchards and groves
    C. Class A,B, and C designations
    d. All of the above
    A. quality of construction materials
    (this multiple choice question has been scrambled)
  31. A regional, city, and neighborhood study of economic, demographic, and other factors to determine supply and demand, market trends, and other factors important to buying, selling, and leasing real property
    A. demography
    B. market analysis
    C. feasibility study
    D. market area
    B. market analysis
    (this multiple choice question has been scrambled)
  32. Areas where market participants live and work
    A. neighborhood
    B. market
    C. suburban sprawl
    D. market area
    D. market area
    (this multiple choice question has been scrambled)
  33. The study to determine if the item in question is marketable
    A. market sales
    B. market characteristics
    C. marketable utility
    D. market study
    D. market study
    (this multiple choice question has been scrambled)
  34. A study of the cost-benefit relationship of an economic endeavor
    A. cost-benefit study
    B. economical study
    C. price relationship
    D. feasibility study
    D. feasibility study
    (this multiple choice question has been scrambled)
  35. Study of population statistics
    demography
  36. A point on the scale of possible prices at which a property might be marketed
    A. center point
    B. sales point
    C. price point
    D. market point
    C. price point
    (this multiple choice question has been scrambled)
  37. Characteristics, which include property types, sizes, styles, ages, and quality
    A. homegeneity
    B. market characteristics
    C. market area
    D. market analysis
    B. market characteristics
    (this multiple choice question has been scrambled)
  38. A geographical area delineated by geographical or political boundaries that is comprised of properties that have complementary land uses
    A. commercial
    B. neighborhood
    C. residential
    D. industrial
    B. neighborhood
    (this multiple choice question has been scrambled)
  39. Uniform or similar value
    A. same value
    B. homegeneity
    C. special assessment
    D. price point
    B. homegeneity
    (this multiple choice question has been scrambled)
  40. Growth (development), stability, decline, and revitalization
    A. Market cycle
    B. Cycle
    C. Neighborhood life cycle
    D. Life cycle
    C. Neighborhood life cycle
    (this multiple choice question has been scrambled)
  41. What is the primary reason for confusion between a feasibility study, marketability study, and market analysis?
    A. inaccurate information provided by public records
    B. outdated sales data from the past
    C. lack of understanding and miscommunication with the client
    D. current market data
    C. lack of understanding and miscommunication with the client
    (this multiple choice question has been scrambled)
  42. Aside from current market conditions, what other factors are taken into accoutn during a real estate market analysis?
    a. development
    b. leasing
    c. sales
    d. all of the above
    d. all of the above
  43. Which study asks the question of whether the cost of undertaking a project will result in a return on investment?
    A. marketability study
    B. market analysis
    C. feasibility study
    D. sale comparison approach
    C. feasibility study
    (this multiple choice question has been scrambled)
  44. In a regional market analysis, which of the following is a factor that helps foster rapid increases in house prices?
    A. loss of tourism
    B. creative financing offered by lenders
    C. the departure of high-tech companies from an area
    D. higher than normal unemployment
    B. creative financing offered by lenders
    (this multiple choice question has been scrambled)
  45. Adam is an appraiser who is analyzing the economic issues affecting a particular region. Which of the following is an economic issue to consider in a regional market analysis?
    A. hazardous waste sites
    B. the proximity of shopping sites
    C. quality and diverification of defense-oritented industries
    D. noise control
    C. quality and diverification of defense-oritented industries
    (this multiple choice question has been scrambled)
  46. A factor that influences regional real property values is:
    a. social trends
    b. government regulation
    c. economic policies
    d. all of the above
    d. all of the above
  47. Physical considerations in a city market analysis include:
    A. sufficient per capita income to support tax base
    B. public transportation facilities
    C. flood control
    D. both flood control and public transportation facilities
    D. both flood control and public transportation facilities
    (this multiple choice question has been scrambled)
  48. In a city market analysis, a basic economy consderation is:
    A. the availability of parks and playgrounds
    B. public or private utilities
    C. roads, highways, and other public works
    D. sufficient tax base to fund government services
    D. sufficient tax base to fund government services
    (this multiple choice question has been scrambled)
  49. A neighborhood analysis would be most important to which of the following properties
    A. mining property
    B. condominium development
    C. a landfill
    D. commercial building
    B. condominium development
    (this multiple choice question has been scrambled)
  50. Which of the following defines a neighborhood?
    A. a geographical area delineated by geographical or political boundaries that is comprised of properties that have complementary land uses
    B. a community whose occupants exhibit a certain degree of economic diversity
    C. a community whose homes exhibit a certain degree of physical variety
    d. all of the above
    A. a geographical area delineated by geographical or political boundaries that is comprised of properties that have complementary land uses
    (this multiple choice question has been scrambled)
  51. What are examples of physical boundaries that determine a neighborhood?
    a. city streets
    b. freeways
    c. streams
    d. all of the above
    d. all of the above
  52. In chronological order, the changes during the life cycle of a neighborhood include:
    A. growth, stability, decline, and revitalization
    B. growth, stability, revitalization, and decline
    C. growth, decline, revitalization, and stability
    D. revitalization, decline, stability, and growth
    A. growth, stability, decline, and revitalization
    (this multiple choice question has been scrambled)
  53. Donna, an experienced appraiser, is conducting a neighborhood analysis for an appraisal assignment. Which of the following is not a physical issue that Donna would consider int he analysis?
    A. per capita income
    B. well-maintained landscaping
    C. lot size
    D. proximity to shopping sites
    A. per capita income
    (this multiple choice question has been scrambled)
  54. A governmental influence an appraiser faces when conducting a neighborhood market analysis includes:
    A. vacancy rates
    B. well-maintained landscaping
    C. special assessments
    D. demographics
    C. special assessments
    (this multiple choice question has been scrambled)
  55. Social factors to consider in a neighborhood analysis include which of the following?
    A. family size
    B. tax burdens
    C. homeowners to renters ratio
    D. special assessments
    A. family size
    (this multiple choice question has been scrambled)
  56. The use, from among reasonable an dadequately supported alternative uses, that is physically possible, legally permitted, economically feasible, and maximally productive
    A. building codes 
    B. excess land
    C. lis pendens
    D. highest and best use
    D. highest and best use
    (this multiple choice question has been scrambled)
  57. An analysis of a proposed subject or property with emphasis on the attainable income, probably expenses, and most advantageous use and design.
    A. interim use
    B. feasibility study
    C. building codes
    D. plottage
    B. feasibility study
    (this multiple choice question has been scrambled)
  58. A type of valuable technique in which the net income remaining to the land (after income attributable to the building has been deducted) is capitalized into an estimate of value for the land.
    A. judgment
    B. feasibility study
    C. plottage
    D. land residual analysis
    D. land residual analysis
    (this multiple choice question has been scrambled)
  59. The principle, which states that the value of property is affected by the potential future benefits.
    A. Principle of conformity
    B. Principle of substitution
    C. Principle of anticipation
    D. Principle of value
    C. Principle of anticipation
    (this multiple choice question has been scrambled)
  60. Properties with a use that predates existing zoning regulations
    A. Residential
    B. Neighborhood
    C. Legally non-conforming
    D. Legally conforming
    C. Legally non-conforming
    (this multiple choice question has been scrambled)
  61. The right of the government to take private property from an owner for the public god by paying fair market value
    A. grandfather clause
    B. eminent domain
    C. police power
    D. variance
    B. eminent domain
    (this multiple choice question has been scrambled)
  62. The highest and best use that can be attained until the time is right for the actual permanent change
    A. grading
    B. interum use
    C. plttoage
    D. emcumbrance
    B. interum use
    (this multiple choice question has been scrambled)
  63. The process of combining two or more small sites to form a larger one
    A. lis pendens
    B. assemblage
    C. plottage
    D. easement
    B. assemblage
    (this multiple choice question has been scrambled)
  64. Surplus land beyond that which is needed to support the property's highest and best use
    A. excess land
    B. extra land
    C. easement
    D. lot size
    A. excess land
    (this multiple choice question has been scrambled)
  65. The contours and features on a parcel of land
    A. plottage
    B. topography
    C. excess land
    D. easement
    B. topography
    (this multiple choice question has been scrambled)
  66. The power of the state to enact laws within constitutional limits to promote the order, safety, health, morals, and general welfare of siciety
    A. judgment
    B. zoning
    C. variance
    D. police power
    D. police power
    (this multiple choice question has been scrambled)
  67. A legal clause that allows a prior use to continue despire subsequent changes in zoning
    grandfather clause
  68. A special exception to the building code
    A. subdivision
    B. variance 
    C. plottage
    D. building codes
    B. variance 
    (this multiple choice question has been scrambled)
  69. Restrictions placed on land with the main purpose of providing minimum standards to protect the environment, and the lives of occupants and the general public
    A. encumbrance
    B. easement
    C. grading
    D. building codes
    D. building codes
    (this multiple choice question has been scrambled)
  70. The division of land into lots for the purpose of sale, lease, or financing
    subdivision
  71. An interest in real property that is held by someone who is not the owner
    A. lien
    B. lis pendens
    C. client
    D. encumbrance
    D. encumbrance
    (this multiple choice question has been scrambled)
  72. The encumbrance that creates a legal obligation to pay (financial encumbrance)
    a. easement
    b. lien
    c. plottage
    d. grading
  73. The right to enter or use someone else's land for a specified purpose
    a. easement
    b. interim use
    c. grading
    d. variance
  74. Basic rules establishing the rights and obligations of owners (and their successors in interest) of real property within a subdivision or other trait of land
    a. grading
    b. plottage
    c. judgment
    d. deed restriction
  75. By definition, highest and best use is:
    a. a use that is physically possible
    b. a use that is financially feasible
    c. the most profitable use
    d. all of the above
    d. all of the above
  76. What is the primary difference that distinguishes a feasibility study from highest and best use?
    A. a feasibility tests whether a project is worth the effort
    B. highest and best use contains five tests
    C. a feasibility study is more complicated
    D. highest and best use tests whether a project is worth the effort
    A. a feasibility tests whether a project is worth the effort
    (this multiple choice question has been scrambled)
  77. Rose owns a small supermarket located on property that has recently been zoned for residential use from commercial use. Regardless of this change, Rose's supermarket still complies with zoning regulations due to its:
    A. conforming use
    B. ability to product income
    C. community contribution
    D. legally non-conforming use
    D. legally non-conforming use
    (this multiple choice question has been scrambled)
  78. While valuing a property, appraiser Andy noticed than an area still dominated by dairy farms is now becoming home to a number of growing condominium development. In this case, the highest and best use would be:
    A. the suburban use
    B. residential housing
    C. the interim use
    D. the permanent use
    C. the interim use
    (this multiple choice question has been scrambled)
  79. If government wants to exercise its power of eminent domain, it must first compensate the owner by paying:
    A. the sales price determined by the cost to rebuild the property
    B. the difference between the original purchase price and market value
    C. the sales price determine by the property owner
    D. fair market value
    D. fair market value
    (this multiple choice question has been scrambled)
  80. Arnold is a real estate developer who is looking for land that is suitable for building tract homes. He comes across a parcel of land overlooking an incredible view, but is too small to accommodate the number of tract homes he is planning to build. Which of the four tests does this fail?
    A. maximally productive
    B. physically possible
    C. financially feasible
    D. legally permitted
    B. physically possible
    (this multiple choice question has been scrambled)
  81. A corner lot would not be ideal for a: 
    A. single-family home
    B. fast food restaurant
    C. convenience store
    D. gas station
    A. single-family home
    (this multiple choice question has been scrambled)
  82. Which of the four tests of highest and best use determines whether a property's use is allowed by law?
    A. legally permitted
    B. physically possible
    C. financially feasible
    D. maximally productive
    A. legally permitted
    (this multiple choice question has been scrambled)
  83. Zoning laws and an example of:
    A. private restrictions
    B. covenants.
    C. public restrictions
    D. eminent domain
    C. public restrictions
    (this multiple choice question has been scrambled)
  84. A property owner is attempting to develop a parcel of land, but local zoning regulations prevent this from occurring. What can the property owner do to continue the development project?
    A. continue since the grandfather caluse applies
    B. exercise eminent domain
    C. ask local government for a variance
    D. continue the project illegally
    C. ask local government for a variance
    (this multiple choice question has been scrambled)
  85. Subdivision laws help to regulate:
    a. the sale or lease of subdivided property
    b. lot design
    c. physical improvements
    d. all of the above
    d. all of the above
  86. An appraiser should check the property records to see if the property is encumbered by the basic rules establishing the rights and owners of real property within a subdivision or other tract of land. These private restrictions are called:
    A. deed restrictions
    B. zoning rules
    C. commandments and restrictions
    D. eminent domain
    A. deed restrictions
    (this multiple choice question has been scrambled)
  87. In order to determine if the highest and best use of a property is financially feasible, the appraise must examine:
    A. accessibility
    B. the topography of the property
    C. supply and demand trends
    D. local zoning laws
    C. supply and demand trends
    (this multiple choice question has been scrambled)
  88. What costs are associated with achieving a property's maximally productive use?
    a. demolition of existing structure
    b. supply and demand trends
    c. accessibility
    d. all of the above
    d. all of the above
  89. When completing an appraisal assignment, what should an appraiser include in the report?
    a. statements that relate tot he highest and best use
    b. a structured review of the four tests of highest and best use
    c. highest and best use analysis from all three approaches to value
    d. all of the above
    d. all of the above
  90. The profit realized from the value of a home less the cost to build it including the cost of the land and all permits
    A. critical thinking
    B. entrepreneurial profit
    C. case study
    D. par course
    B. entrepreneurial profit
    (this multiple choice question has been scrambled)
  91. The analysis of a real-life problem, which defines the problem and discusses applicable solutions
    A. brainstorming
    B. critical thinking
    C. par course
    D. case study
    D. case study
    (this multiple choice question has been scrambled)
  92. A fitness trail with natural and manufactured obstacles or stations to promote better health
    A. rehabilitation
    B. par course
    C. shared facilities
    D. industrial facilities
    C. shared facilities
    (this multiple choice question has been scrambled)
  93. A careful, precise analysis or examination of the facts
    critical thinking
  94. The analysis of a real life problem, designed usually for training purposes, is called a(n):
    A. disciplinary action
    B. database
    C. opinion report
    D. case study
    D. case study
    (this multiple choice question has been scrambled)
  95. The careful, precise analysis or examination of the facts is known as:
    A. applicable solutions
    B. unsupported conclusions
    C. interrogation
    D. critical thinking
    D. critical thinking
    (this multiple choice question has been scrambled)
  96. Which of the following questions should not be asked by te appraiser to properly analyze the marketplace of a subject property?
    A. what is the growth rate?
    B. what is the balance of supply and demand?
    C. are values increasing, decreasing, or staying about the same?
    D. what ethnicities make up the neighborhood?
    D. what ethnicities make up the neighborhood?
    (this multiple choice question has been scrambled)
  97. Which of the following is a valud source of information for credible market analysis?
    a. computerized databases
    b. county recorder's office
    c. local real estate agents
    d. all of the above
    d. all of the above
  98. Good business practices of an appraisal professional should include all of the following; except:
    A. accepting an assignment for which the appraiser has no experience or knowledge
    B. acting with moral integrity to create an honest report
    C. having advertising signs on the vehicle
    D. carrying proper identification and having business cards available
    A. accepting an assignment for which the appraiser has no experience or knowledge
    (this multiple choice question has been scrambled)
  99. After a subject property has been correctly identified and categorized, an appraiser will look for ____ properties to develop the appraisal
    A. dissimilar
    B. comparable
    C. non-conformable
    D. unusual
    B. comparable
    (this multiple choice question has been scrambled)
  100. The amount of rents paid can be determined by all of the following methods, except:
    A. the county assessor's office
    B. asking tenants what the local rental market levels are
    C. checking local newspapers
    D. calling the phone numbers on a For Rent sign
    A. the county assessor's office
    (this multiple choice question has been scrambled)
  101. One of the most critical items to be considered its determining the highest and best use is:
    A. off-street parking and common walkways
    B. entrepreneurial profit
    C. the proximity of retail shops
    D. the curb appeal of the subject property
    B. entrepreneurial profit
    (this multiple choice question has been scrambled)
  102. Typically, which assignment is the least difficult to complete?
    A. rental survey
    B. eminent domain evaluations
    C. feasibility studies
    D. right of way evaluations
    A. rental survey
    (this multiple choice question has been scrambled)
  103. Which of the following is not a typical assignment?
    A. market value for a residentual property
    B. going concern value of a business in a shopping center
    C. highest and best use of a residential lot
    D. market survey for neighborhood rents
    B. going concern value of a business in a shopping center
    (this multiple choice question has been scrambled)

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