Unit 8

true

Laws cannot guarantee an ethical or moral marketplace. t/f

B) the Sherman Antitrust Act.

Activities such as price-fixing, group boycotting, allocation of customers or markets, and tie-in agreements are violations of A) the Schumacher Antitrust Act. B) the Sherman Antitrust Act. C) the Stassen Antitrust Act. D) the Sheridan Antitrust Act.

false

Price-fixing, which is the practice of setting prices for products or services rather than letting competition in the open market establish those prices, is legal. t/f

false

Real estate license laws do not include disciplinary systems. t/f

false

The Institute of Real Estate Management (IREM) is affiliated with the National Association of Real Estate Brokers (NAREB). t/f

A) its members.

The National Association of REALTORS® has adopted a code of ethics for A) its members. B) states that have adopted its code. C) all real estate licensees. D) all real estate professionals.

A) state, regional, and local associations.

The National Association of REALTORS® is composed of A) state, regional, and local associations. B) state associations. C) state and regional associations. D) local associations.

false

A sales associate can carry out all the same activities as a real estate broker. t/f

false

A sales associate's compensation is determined by the client. t/f

real estate assistant

a licensed employee of the employing broker who is compensated by the broker, or, if unlicensed, is paid by either the sales associate or broker and is limited in the activities that can be undertaken.

B) All of these.

Internet advertising regulations include which of the following stipulations? A) Advertising may not be misleading. B) All of these. C) Sponsoring broker's name must be included in advertising. D) Real estate professional must disclose license status on each page of website that contains an advertisement.

Realtist Code of Ethics

established buy the National Association of Real Estate Brokers

social media

internet tools to facilitate the creation and sharing of information

tie-in arrangement

providing product or service to customer only if the customer buys another product or service as well

Standards of Practice

Practical applications of the articles of the REALTOR Code of Ethics

A) is the largest real estate trade association in the country

The National Association of REALTORS®(NAR) A) is the largest real estate trade association in the country. B) is the tenth-largest trade association in the country. C) has somewhat less than one million members. D) is the second-largest trade association in the country.

C) the Federal Trade Commission (FTC).

The National Do Not Call Registry is managed by A) Consumer Finance Protection Bureau (CFPB). B) HUD. C) the Federal Trade Commission (FTC). D) NAR.

B) Graduated commission split

What is the compensation plan called if a sales associate's commission split increases depending on whether the sales associate achieves higher production goals? A) Cooperating broker commission B) Graduated commission split C) Procuring cause commission D) 100% commission plan

false

When information is taken from the internet, it is always accurate. t/f

A) Consumers

Which group of people is protected the MOST by real estate license laws? A) Consumers B) Government employees C) Real estate firms D) Licensees

C) CAN-SPAM Act

Which law has a feature that commercial email messages must include a means by which the recipient can unsubscribe? A) COPPA B) FCC Act C) CAN-SPAM Act D) TCPA

independent contractor

an employee who usually receives a commission, with no withholding for Social Security, income tax, and other purposes and has the freedom to set hours and accomplish goals

false

A real estate assistant would never be required to have a real estate license. t/f

true

A real estate broker is licensed to buy, sell, exchange, or lease real property for others and to charge a fee for those services. t/f

true

A real estate broker's compensation is specified in the contract with the client. t/f

D) an independent contractor.

A real estate licensee has a written contract with a broker specifying that the licensee will not be treated as an employee. The licensee's entire income is from sales commissions rather than an hourly wage. Based on these facts, the licensee is considered A) an employee. B) a real estate assistant. C) a subagent. D) an independent contractor.

B) two or more businesses conspire against another business or agree to withhold their patronage to reduce competition.

Group boycotting is illegal and occurs when A) agents of one real estate organization refuse to socialize with another. B) two or more businesses conspire against another business or agree to withhold their patronage to reduce competition. C) agents refuse to provide services to a certain class of individuals. D) a group of neighbors decide to boycott the services of a particular agent.

true

Group boycotting, allocation of customers or markets, and tie-in agreements are all prohibited acts under the Sherman Antitrust Act. t/f

NAR

Has an established Code of Ethics that REALTORS must subscribe to.

Uniform Electronic Transactions Act (UETA)

sets basic rules for entering an enforceable contract using electronic means

price-fixing

setting commission rate among competitors for service

B) Standards of Practice.

Practical applications of the articles of the REALTORS® Code of Ethics are known as A) Covenants of Business. B) Standards of Practice. C) Standards of Business. D) Covenants of Practice.

true

ARELLO promotes state licensing standards. t/f

CRS

Affiliate designation of NAR specializing in residential property

A) in all cases.

Commissions are negotiable A) in all cases. B) unless the exclusive agency listing is used, because the seller can compete with the broker. C) unless representing a buyer, when the listing broker offers a co-op. D) when using an exclusive listing agreement, but not an open listing.

D) $270,000 plus attorney's fees and costs

Two real estate professionals were found guilty of conspiring with each other to allocate real estate brokerage markets. A seller suffered an estimated $90,000 loss because of their activities. If the seller brings a civil suit against the two real estate professionals, what can the seller expect to recover? A) Actual damages plus attorney's fees and costs B) Nothing, because a civil suit cannot be brought for damages resulting from antitrust activities C) Only $90,000—the amount of actual damages the seller suffered D) $270,000 plus attorney's fees and costs

allocation of customers or markets

agreement between real estate professionals to divide market and not complete with each other's business

Internet Data Exchange

allows MLS members equal rights to display MLS data

Internet Data Exchange (IDX) policy of the National Association of REALTORS®

allows members to limit the internet distribution of listing information.

a broker's commission

can be a commission based on a property's sales price, a flat fee, or an hourly rate

GRI

has completed the requirements of the Realtor Institute

A) The broker may legally set the minimum commission rate acceptable for the firm.

A broker's policy requires a 7% commission on all listings; no lower commission rate is acceptable. Which statement is TRUE? A) The broker may legally set the minimum commission rate acceptable for the firm. B) The sales associates associated with the brokerage will not be bound by the requirement and may negotiate any commission rate they choose. C) The broker must present the uniform commission policy to the local professional association for approval. D) A homeowner may sue the broker for violating the antitrust law's prohibition against price-fixing.

C) a violation of antitrust laws.

If a sales associate hints to prospective clients that the commission rate matches the "going rate," this action is A) not a violation of antitrust laws. B) recommended practice by the National Association of REALTORS® . C) a violation of antitrust laws. D) a common practice allowed in most states.

false

If a state licensing authority's regulations conflict with statutory law, the regulations will prevail. t/f

D) CAN-SPAM Act

Junk emails are prohibited by what legislation? A) TCPA B) COPPA C) FCC Act D) CAN-SPAM Act

true

Many trade organizations serve the real estate business. The largest is the National Association of REALTORS® (NAR). t/f

A) members are known as Realtists.

National Association of Real Estate Brokers (NAREB) A) members are known as Realtists. B) no longer concerns itself with equal housing opportunity. C) members are known as REALTORS®. D) is part of the National Association of REALTORS®.

B) The seller decided not to sell.

The broker may still be entitled to a commission in which of these situations where a pending property sale did NOT close? A) The buyer decided not to buy the property. B) The seller decided not to sell. C) Financing fell through for the buyer. D) The buyer wanted to add the kitchen appliances to the sale, but the seller refused.

Realtist

a member of the National Association of Real Estate Brokers.

electronic contracting

transactions conducted through email or fax

Group Boycott

two or more businesses conspiring against another business

spam

unsolicited junk email

B) The broker may, as a matter of office policy, legally set the minimum commission rate acceptable for the firm.

A broker has established the following office policy: "All listings taken by any sales associate of this real estate brokerage must include compensation based on a 7% commission. No lower commission rate is acceptable." If the broker attempts to impose this uniform commission requirement, which statement is TRUE? A) The broker must present the uniform commission policy to the local professional association for approval. B) The broker may, as a matter of office policy, legally set the minimum commission rate acceptable for the firm. C) The sales associates of the brokerage will not be bound by the requirement and may negotiate any commission rate they choose. D) A homeowner may sue the broker for violating the antitrust law's prohibition against price-fixing.

A) Licensing authority (division, Commission, etc.)

After license laws are enacted by the legislature, who is responsible for adopting administrative regulations? A) Licensing authority (division, Commission, etc.) B) Brokers and sales associates appointed by the governor C) A subcommittee that reports to the legislature D) A local association of REALTORS®

true

All 50 states regulate the activities of real estate professionals. t/f

D) complying with a commission rate set by a trade organization.

All of the following are required of a broker who is seeking to collect a commission for brokering the sale of a property EXCEPT A) having had a contract of employment—an agency representation agreement. B) having a valid real estate broker's license. C) having been the procuring cause in the transaction or having an exclusive-right-to-sell agreement. D) complying with a commission rate set by a trade organization.

C) commission splitting.

All of these are violations of federal antitrust law EXCEPT A) tie-in agreements. B) allocation of customers. C) commission splitting. D) group boycotting.

C) give contracts created using email the same legal standing as those on paper.

An important purpose of the E-Sign Act is to A) require stringent security measures for email communication. B) prevent notarization of electronically transmitted agreements. C) give contracts created using email the same legal standing as those on paper. D) require all parties to use electronic contracting if the seller prefers it.

D) the procuring cause.

An owner tells a group of brokers, "I will pay a commission to whoever brings me a buyer." In this case, the broker who is going to get paid must be A) the dual agent. B) the exclusive agent. C) the facilitator. D) the procuring cause.

C) sales associates within the same office agreeing on a standard commission rate.

Antitrust laws do NOT prohibit real estate A) companies allocating markets based on the location of commercial buildings. B) companies agreeing on fees charged to sellers. C) sales associates within the same office agreeing on a standard commission rate. D) brokers allocating markets based on the value of homes.

C) $387,492

Assuming that the listing broker and selling broker split their commission from a transaction equally, what was the sales price of a rural property if the commission rate was 6.5% and the listing broker received $12,593.50? A) $139,900 B) $256,200 C) $387,492 D) $193,746

true

Real estate license laws are intended to protect the public. t/f

A) have the same force and effect as statutory law.

Regulations of agencies that administer real estate license laws A) have the same force and effect as statutory law. B) can be modified, if necessary, to insure compliance by large real estate firms. C) are optional for licensees, though their adherence is always recommended. D) can only be changed by the legislature.

false

States' licensing rules and regulations do NOT have the same force and effect as statutory law.

A) mutual agreement with the broker.

The amount of commission paid to a sales associate is determined by A) mutual agreement with the broker. B) state law. C) the local real estate board. D) mutual agreement with the client.

A) subject to negotiation between broker and sales associate.

The compensation received by a sales associate of the real estate broker is A) subject to negotiation between broker and sales associate. B) decided upon by the real estate broker, who has authority over the sales associate. C) no more than the statutory commission rate. D) subject to state regulations regarding the method and amount of compensation.

A) UETA.

The federal law that makes contracts originated, negotiated, and executed over a combination of computer and cell phone enforceable is A) UETA. B) Junk Fax Prevention Act. C) COPPA. D) CAN-SPAM.

true

The purpose of the Electronic Signatures in Global and National Commerce Act (E-Sign) is to make contracts (including signatures) and records legally enforceable, regardless of the medium in which they are created. t/f

sales associate

a salesperson or broker who is licensed to perform real estate activities only on behalf of a licensed real estate broker.

ethics

a system of moral principles, rules, and conduct

broker-employer

liable for the actions of the sales associate within the scope of the employment agreement or as provided by state law.

real estate broker

licensed to buy, sell, exchange, or lease real property for others for a fee and may operate as a sole proprietorship, partnership, corporation, or limited liability company.

National Do Not Call Registry

list of phone numbers from consumers who want to limit telemarketing calls

real estate brokerage

may be independent or part of a regional or national franchise.

Realtor

members of the National Association of Realtors