Chapter 15 Quiz & Review

A good balance between supply and demand for residential real estate is indicated when the vacancy rate is approx ____

5%

What is the correct order in which the criteria for estimating highest and best use should be considered?

Legally permissible, physically possible, economically feasible, and macimally productive

The real estate market experiences changes and cycles. What is the term used to describe the phase of the market where ther eis not enough demand to meet the current over-supply of available housing units?

buyers market

How does the real estte market react to shifts in consumer demand?

Slowly

In which condition does market equilibrium theoretically exist?

When supply and demand are in balance

Which of the following market factors will typically result in increased demand?

a decrease in prices

Which of the following best describes the free enterprise system?

a market system

In the real estate market, what is a developer considered to be?

a supplier

The real estate buisness cycle has four phases with no beggining and end. When at its peak the subsequent phases in order would be

contraction, trough and expansion

All of the following statements appy to the real estate market EXCEPT a. Situs value is value resulting from loaction b.real estate is immobile c. each parcel of real estate is unique d. the real estate market is national in nature

d. the real estate market is national in nature

Many visible "for sale" signs and an increased number of rentals may indicate the neighborhood has entered a period of ________

decline

Which of the following might be indicated if a neighbohood appears to have an abundance of "for sale" signs and an unusually high number of rentals available?

decline in the neighborhood may be indicated

Population, credit, income and consumer preferences are related to the ________ for real estate

demand

Which external force that affects value is indicated by the number of vacancies in an area?

economic

What is the correct order of the buisness cycle phases?

expansion, peak, contraction and trough

The social , economic, governmental and environmental forces that affect real estate values are referred to as ____________-

externalization

What term is used to describe the relatively new phenomenon in which small families move into older neighborhoods, renovate the propertires, and displace poorer residents?

gentrification

The use that creates the highest value to land is its ___________ and ____________ use.

highest and best use

Price and demand are inversely related, this means that demand will typically decrease as prices ______ and as prices decrease demand will typically _______

increase, increasae

Physical real estate is characterized as being _________ _________ and _________

indestructable, immobile and heterogeneous

The real estate market can best be described as being __________ and __________.

inefficient and unorganized

The four factors of production include what?

land, labor, capital and entrepreneurial ability

It has been determined that the value of three lots, each with a value of 10,000 each is 50,000 as a single tract parcel. Which concept does this illustrate?

plottage

If two or more parcels have a greater values as a single tract than the sum of their individual values as separate sites, their combination results in _________ value

plottage value

When estimating supply, it is not necessary to consider which of the following? a. price b. availabiity of materials c. availability of skilled labor d. availability of land

price

A __________ market exists when there is an excess of demand over supply

sellers market

Immigration and emigration into and out of a neighborhood are an influence on value that can be categorized as a ________ force

social

An economic term used to identify value which results from the location of a parcel of land is

situs

The real estate market is ________ to respond to changes in supply and demand

slow

The availabiity of materials, labor, financings and land are all associated with the ________ of real estate

supply

Two factors that affect a real estate market are supply and demand. Which of the following is a good indicator of the masure of supply versus demand

the vacancy rate in the community