Real Estate Chapter 2 quiz part 1 & 2

A property was sold for $525,600. The total commission for the transaction was 6%. The listing broker and buyer's broker agreed to split the commission 50/50. If the buyer's broker's real estate agent was responsible for the sale of the property and receives a 65/35 split with his broker, how much commission is paid to the real estate agent...?

10,249.20

A property was sold for $845,000. The total commission for the transaction was 6%. The listing broker and buyer's broker agreed to split the commission 50/50. What is the amount of commission paid to the buyer's broker...?

25,350

Cindy's house was listed at $732,100. The property eventually sold for $736,250. The agreed upon commission was 6%. How much did Cindy pay in commissions at the closing of the property...?

44,175

A property was sold for $220,000. The total commission for the transaction was 5%. The listing broker and buyer's broker agreed to split the commission 50/50. What is the amount of commission paid to the listing broker...?

5,500

What is the typical length of term for an Exclusive Right to Sell agreement...?

6 months

A property was sold for $345,000. The total commission for the transaction was 6%. The listing broker and buyer's broker agreed to split the commission 50/50. If the listing broker's real estate agent was responsible for the sale of the property and received a 70/30 split with his broker, how much commission is paid to the real estate agent...?

7,245

A property was sold for $750,000. The total commission for the transaction was 6%. The listing broker and buyer's broker agreed to split the commission 50/50. If the buyer's broker's real estate agent was responsible for the sale of the property and receives a 40/60 with his broker, how much commission is paid to the real estate agent...?

9000

According to NYS law, how long is a broker allowed to take an extended leave of absence from his/her brokerage office...?

A broker is not allowed to take an extended leave of absence

How is an agent's commission typically paid in a residential rental transaction...?

A percentage of the annual rent

Abby is a real estate broker who has entered into an agency relationship with Mark, a landlord looking to lease one of his apartments. Abby brings Andrew, a prospective tenant, to Mark with an offer to rent Mark's apartment. Which of the following statements is correct...?

Abby is the Agent, Mark is the Client, and Andrew is the Customer

John is interested in purchasing a two bedroom house and enters into an agency relationship with Chris, a real estate broker, to help him find a house. According to the fiduciary duties Chris owes to John, which of the following is true...?

According to the duty of Obedience, Chris should not show John one bedroom houses

If there is any doubt as to the distribution of proceeds at the closing table, it must be resolved in favor of the client, as per which fiduciary duty...?

Accountability

Whose job is it to act as a middleman in a transaction...?

Broker

According to an agent's fiduciary duties, the agent must not reveal information detrimental to his/her client without written permission. Which of the following fiduciary duties best reflects this...?

Confidentiality

Which of the following is a primary duty of the principal to the agent...?

Cooperative with the agent

The party the agent brings to the principal as seller or buyer of the property is known as the...?

Customer

Which of the following may be considered a 3rd party to a transaction...?

Customer

David is a real estate agent with City brokerage. City brokerage is headquartered on Park Avenue in Manhattan; however, there are satellite offices in each of the major neighborhoods throughout Manhattan. As an agent, in which office is David required to work...?

David is not required to work in any office if he so chooses

When an agent is appointed to act on behalf of the buyer in a dual agency arrangement, they are referred to as a...?

Designated Sales Agent

Both the seller and the buyer must give their consent in writing for the creation of what...?

Dual agency

Chris is a real estate salesperson who represents the seller in a transaction. If another agent from Chris' brokerage firm represents the buyer in the same transaction, what type of agency will exist...?

Dual agency

Jim is a real estate salesperson who represents the seller in a transaction. Michael, a real estate salesperson from the same brokerage firm as Jim, represents the buyer in the transaction. In this scenario, what type of agency exists...?

Dual agency

When a buyer's broker agrees to the cooperative arrangement of the MLS, and becomes a sub-agent to the seller, what type of agency is created...?

Dual agency

Which of the following does an agent NOT have to disclosure to his/her client...?

Ease of transportation in the neighborhood

Ely is a real estate broker who has entered into an agency relationship with Justin, a property owner looking to sell his house. Ely brings James, a prospective buyer, to Justin with an offer to purchase Justin's house. Which of the following statements is correct...?

Ely is the Agent, Justin is the Principal, and James is the Customer

You may be breaching the fiduciary duties you owe to your principal if you do not do which of the following...?

Exercise reasonable care

A person who on behalf of, or for the benefit of another, transacts business or handles money or property not the person's own is known as a...?

Fiduciary

Josh, a real estate broker, is hesitant to enter into a dual agency arrangement as it may affect these duties to his client...?

Fiduciary Duties

Andrew, a real estate broker representing the buyer in a transaction, has entered into a dual agency arrangement after agreeing to the MLS cooperative arrangement. What does Andrew owe the seller in the transaction...?

Fiduciary responsibilities

As an agent to a condo board, John has the power to hire and/or fire employees. This suggests that John is what type of agent...?

General agent

Which of the following is considered an anti-trust violation...?

Group Boycott

Which of the following should an agent recommend to their client as a means to verify the financial capabilities of the client...?

Have the buyer obtain a pre-approval letter from a lender

According to this concept, the principal must act to defend the agent in the event the agent is sued while acting on behalf of the principal...?

Indemnification

What should be provided before a dual agency relationship occurs...?

Informed consent by all parties

Two agents are attempting to create a dual agency with permission from both the buyer and seller. According to New York State law, what must be given in-writing...?

Informed consent from all parties

John, a real estate salesperson, was referred a client from another agent. After successfully closing on the deal, John would like to offer a referral fee to the agent who referred the client. What must John obtain first before offering a referral fee...?

Informed consent of the client

Two brokerage firms in a particular market entered into an agreement with each other to refrain from competition. They agreed that one firm would only do business on the west side of the city while the other firm would only do business on the east side of the city. What are the two firms guilty of...?

Market Allocation

This document describes the roles and duties of a dual agent...?

NYS Disclosure Form

Which of the following documents should an agent most often keep record of for all past transactions...?

NYS Disclosure Form

What acronym can be used to remember the six fiduciary duties of an agent...?

OLD CAR

The 'O' in the acronym 'OLD CAR' refers to which of the agent's six fiduciary duties...?

Obedience

The 'R' in the acronym 'OLD CAR' refers to which of the agent's six fiduciary duties...?

Reasonable Care

According to an agent's fiduciary duties, the agent must be competent and not act in a negligent manner. Which of the following fiduciary duties best reflects this...?

Reasonable care

John, a real estate broker, and Chris, a property owner, have entered into an agency relationship. Soon after, a dispute arose in regards to how much commission should be paid to John if he finds a buyer for Chris' property. What should they do to resolve their dispute...?

Refer back to the listing agreement, which states the agreed upon commission

According to the 'In-house Sales' clause in an Exclusive Right to Sell agreement, a seller cannot do which of the following if the listing broker also finds a buyer...?

Refuse to pay a commission to the listing broker

Which section of the New York State Real Property Law states that the broker may be liable for the salesperson's actions...?

Section 442-C

Abby, a real estate broker, has entered into an agreement to sell John's house. Who will be the customer in the transaction...?

The Buyer

Which of the following is NOT a characteristic of an independent contractor relationship...?

The agent cannot work for another company

Which of the following is NOT a characteristic of an independent contractor relationship...?

The agent is entitled to health benefits

Which of the following is a characteristic of an independent contractor relationship...?

The agent is not required to work in a specific location

Which of the following is a characteristic of an independent contractor relationship...?

The agent is not required to work set hours

Which of the following is NOT a characteristic of an independent contractor relationship...?

The agent is paid hourly wages

In addition to the agent signing the independent contractor agreement, what else is required before the agreement can be finalized...?

The agreement must be notarized

Even if the buyer's and seller's brokers agree to dual agency, who may reject the arrangement of dual agency in a transaction...?

The buyer

Abby is a real estate agent who represents the seller in a transaction. Her colleague, Kimberly, works for the same broker and represents a prospective buyer. Both Abby and Kimberly's clients want to gain a better understanding as to the risks and benefits of entering into a dual agency relationship. What document should Abby and Kimberly present to their clients...?

The disclosure form

If all principals in a transaction initially agree to dual agency, but one of the principals subsequently withdraws their consent, what happens to the dual agency...?

The dual agency cannot proceed

If an owner terminates an Exclusive Right to Sell agreement prior to closing on the property, but the listing broker introduced the buyer to the seller, who is entitled to the commission...?

The original listing broker

What happens if any of the principals in a transaction refuse to grant consent to dual agency...?

The parties cannot proceed with dual agency

The Listing Price is also referred to as what...?

The price agreed upon in the contract between the seller and seller's agent

A seller agrees to have their property listed on the MLS. As a result, the seller agrees to a dual agency relationship. What may arise if the seller subsequently withdraws their consent to dual agency...?

The property can no longer be listed on the MLS

According to NYS Law, how much income must an agent generate in order to maintain their status as a licensed real estate agent...?

There are no required minimum earnings

Obedience

This fiduciary relationship obligates the agent to act in good faith at all times, obeying the client's instructions in accordance with the contract.

Maggie, a real estate broker representing a buyer, tells her client that they must use her mortgage broker to obtain a mortgage, otherwise, she won't show the best deals on the market. What has Maggie introduced to her client...?

Tie-in arrangement

As an independent contractor, which of the following is an expense that must be paid by the agent...?

Travel expenses

Chris and Mark are real estate agents working for the same broker. Chris is seeking to rent an apartment on behalf of his client, while Mark's client is interested in renting the apartment. If all parties in the transaction agree to dual agency, which fiduciary duty to the principals may be most at risk...?

Undivided loyalty

Which of the following is NOT considered a principal in an agency relationship...?

agent

If two brokerage firms enter into a market allocation agreement, what may they be limiting...?

competition

Two brokers entered into an agreement whereby one broker will only do business on the east side of the city and the other broker will only do business on the west side of the city, in essence creating a market allocation agreement. What would this agreement limit...?

competition

Andrew has accepted a new job in San Francisco and needs to sell his house quickly. Andrew hired a real estate agent to help with the transaction. If the agent reveals this information to a prospective buyer, it would be a breach of which fiduciary duty...?

confidentiality

Susan and Mark are in the process of getting a divorce and need to sell their house quickly. They have hired a real estate broker to help facilitate the transaction. According to which fiduciary duty must the information regarding the divorce not be disclosed...?

confidentiality

Which of the following fiduciary duties is conversely related to the duty of Disclosure...?

confidentiality

Mark, a real estate agent, is attempting to rent an apartment on behalf of his client. Another agent, who works for Mark's broker, is seeking to show the apartment to his client. In this scenario, what type of agency exists...?

dual agency

Unlike single agency where a broker represents either the buyer or the seller, but not both, in this type of agency a broker can represent both the buyer and seller...?

dual agency

Michael, a property owner, allowed Andrew, a real estate broker, to show his house to prospective buyers. However, Michael and Andrew do not have a signed agency agreement and instead operated under an implied agency. According to this doctrine, Michael cannot claim that an agency relationship did not exist...?

estoppel

Mark is a real estate agent who has entered into an agency relationship with David, a homeowner, to sell David's house. They agreed to set Mark's commission at 6% of the sales price. How else may the commission be calculated...?

flat fee

As an agent to a cooperative board, Jason has the authority to negotiate contracts with 3rd party vendors to service the building. This level of authority suggests that Jason is what type of agent...?

general agent

Marcus is a real estate broker representing a seller. Jason, a buyer's broker, is attempting to do a deal with Marcus that would prevent other broker's from showing their clients Marcus' client's property. In this scenario, what may Jason and Marcus be liable of if they act on this agreement...?

group boycotting

Mark, a real estate broker, teamed up with Chris, another real estate broker, in an effort to not do business with a cross-town broker. What may Mark and Chris be accused of...?

group boycotting

Town Realty and City Realty created an alliance in an attempt to prevent another brokerage firm from competing in the marketplace. What may Town Realty and City Realty be guilty of...?

group boycotting

If a property owner seeking to sell his house knows that an agent is showing his house to prospective buyers, but does not have an agency agreement with the agent, what type of agency relationship may arise...?

implied agency

This is a form of agency that occurs when the words and actions of the parties indicate that there is an agency relationship...?

implied agency

Which of the following is considered a principal in an agency relationship...?

landlord

Which of the following is NOT an example of an agency relationship...?

landlord - tenant

John, a real estate broker, and Chris, a property owner, have entered into an agency relationship. The scope of their agency relationship is defined in what document...?

listing agreement

According to an agent's fiduciary duties, the agent must work in the best interests of his/her client. Which of the following fiduciary duties best reflects this...?

loyalty

An agent's duty to place the client's interest above those of all others, including the agent's own self-interest, is known as...?

loyalty

Ben, a real estate agent, represents several buyers. In an attempt to increase his commission, he decides to have his clients bid against the same property without their knowledge or consent. Which fiduciary duty has Ben breached...?

loyalty

Which of the following is considered an anti-trust violation...?'

market allocation

An agreement between members of a trade to refrain from competition in specific market areas is known as...?

marketing allocation

Making an intentionally false statement to induce someone to contract is known as...?

misrepresentation

Which of the following is NOT an example of an agency relationship...?

owner - tenant

Sandy is a real estate agent who has entered into an agency relationship with Jim, a homeowner, to sell Jim's house. They agreed upon a flat fee for Sandy as compensation for a successful transaction. What other means of compensation may be agreed upon between the two...?

percentages of sale price

If a union of brokers in New York State bound together and agreed to only accept commissions of 9% or higher, far more than the typical 6% in a transaction, what may they be held liable for...?

price fixing

The degree of caution and concern for the safety of himself/herself and others an ordinarily prudent and rational person would use in the circumstances is known as...?

reasonable care

An agent who represents the seller of real property is referred to as the...?

seller's agent

An agent with limited authority to act on behalf of the principal, such as created by a listing agreement, is known as a...?

special agent

John, a real estate salesperson, has entered into an agency agreement with a client whose scope is limited to that described in the agreement. This level of authority suggests that John is what type of agent...?

special agent

When a buyer's broker agrees to the cooperative arrangement of the MLS, he/she becomes what to the seller, who's property is listed on the MLS...?

sub-agent

The broker, as a franchisee of a national brokerage, is considered what to the national brokerage...?

subagent

A licensed real estate agent who acts on behalf of a tenant in a commercial property transaction is known as a...?

tenants agent