Real Estate Principles II - Unit 10 - test

A seller was willing to sell her property, but only if she would net $150,100 from the sale after paying a 5% commission. What would be the selling price of the property to net $150,100?

$158,000 Hint: Calculate this by dividing the amount the seller wants to net by the reciprocal of the commission rate (100% - 5% = 95%). $150,100 ÷ .95 = $158,000.

Tom signed a note for $3,000, which is to be paid off in 12 months. He owes the $3,000 plus 9% interest when the note is due. An investor buys the note at a 20% discount. What is the amount paid by the investor?

$2,400 Hint: The 20% discount on the note is $600. The investor paid $2,400 for the note. [$3,000 - $600 = $2,400]

Sam has a savings account that pays 5% interest. In order for Sam to earn $100 per month, how much should be deposit into the savings account?

$24,000 Hint: Principal = Interest÷ Rate. Principal = $1,200 ($100 x 12 months) ÷ 0.05 = $24,000.

Sandra, a real estate sales associate, found a buyer for a $200,000 house. The seller agreed to pay a 6% commission to the listing broker, half of which will be paid to Sandra's broker. Sandra is on a 50-50 split with her broker. What is the amount of her commission?

$3,000 Hint: $200,000 x 6% = $12,000 / 2 brokers = $6,000 to Sandra's broker and $3,000 to Sandra.

Which of the following measurement equivalents is incorrect?

**a. 1 acre is equivalent to 43,560 feet. b. 1 board foot is equivalent to 144 cubic inches. c. 1 square yard is equivalent to 9 square feet. d. 1 mile is equivalent to 5,280 feet

Which of the following is true regarding the history of calculators?

**a. All of the choices apply b. Real estate professionals used mortgage tables. c. Real estate professionals used desktop calculators. d. Real estate professionals would "run" the numbers on real estate transactions.

What are the correct conversion of 6 2/3% to a decimal?

0.0667

10.0% converted to a decimal is:

0.10

Dave inherited an acre of land with a depth of 165 feet that went down to the seasonal creek. What is the width of the land?

264 feet Hint: An acre is 43,560 square feet. 43,560 ÷ 165 feet is 264 feet.

For prorating purposes, use _____ days for a month and _____ days in a year.

30; 360

Ed wants to build a small 800 square foot cabin on a lot that is 80 feet deep. If the building sideyard setbacks are 20 feet and the cabin is 20 feet wide, what is the square footage of the lot?

4,800 square feet Hint: First calculate the width of the lot. Add the 2 side yard setbacks and the width of the cabin. [20 feet + 20 feet + 20 feet = 60 feet]. Then multiply the width of the lot times its depth. [60 feet x 80 feet = 4,800 square feet.]

Tom owns a 1,200 square foot, rectangular shaped ranch house that just barely fits on his 50 foot wide lot. If the house is 30 feet wide, what is the length of the house?

40 feet Hint: 1,200 ÷ 30 feet is 40 feet.

How many linear feet are in 1 mile?

5,280 feet

Diane paid $600,000 for a six-unit apartment building. The gross income is $900 per month per unit, with annual expenses of $16,800 annually. What was the capitalization rate for this investment?

8% Hint: First calculate annual gross income. $900 x 6 x 12 = $64,800. Next determine the net income. $64,800 - $16,880 = $48,000. $48,000 / $600,000 = .08 or 8%.

Which of the following is important when selecting a calculator?

Ensure the calculator can compute simple loan amortization

What is the charge for the use of money?

Interest

__________ is the process of distributing expenses at the close of the sale.

Proration

How is the value of a number determined?

The position of the decimal point

Which of the following is not true regarding calculators today?

a. Calculator applications can be downloaded to a smartphone. b. Handheld financial calculators and calculator applications include memory functions. c. Handheld financial calculators and calculator applications include basic arithmetic calculations. **d. Handheld financial calculators are expensive.

Which of the following statements in incorrect?

a. Monthly means every month. b. Semimonthly means twice a month. c. Bimonthly means every 2 months. **d. Bimonthly means twice a month.

The distance outside a square or rectangle is the:

perimeter