Texas Real Estate Brokerage SAE

Rogelio and Carla's firm identified three risk sources as high level (6 and 9 on their ranking scale). They've set themselves up for disaster by using ___ as their risk management strategy.

Acceptance

Deidre owns her own brokerage firm. In addition to running the business, she continues to assist clients and manage transactions. What type of broker-owner is she?

Active

When a sales contract doesn't cover the terms needed by the parties, which of the following actions is a licensee allowed to take?

Add a standard addendum using standard language.

Activities that restrain trade and reduce competition and choices for consumers are considered to be what kind of violations?

Anittrust

Broker Donna plans to hire three licensees to begin growing her business from a one-agent to a four-agent firm. What tip would you offer Donna regarding the impact of growth on her as the broker-owner?

As more staff is hired, she will spend more time managing sales staff.

Broker Saul has just signed a written agreement with his newest licensee, Jill, stating that Jill is an independent contractor. To ensure Jill is properly classified, Saul should do which of the following?

Base her compensation on her sales output

If a community plan requires developers to build new public spaces in urban areas as part of new construction projects, and the result is that more people want to live and work in the city, what impact would this have on a real estate business? Select the most complete answer.

Because the plan includes both a cost for developers and the benefit of making an area more desirable, it could be weighted differently, depending on the services the real estate business offers.

A business that's establishing a customer base and market presence is most likely in what stage of the business life cycle?

Birth

You're a broker who sees a potential issue with your licensee, Joss. You've identified the problem behavior and analyzed the problem. What is the next step in the problem-solving process for personnel issues?

Brainstorm a solution. The third step in this process is to brainstorm the solution. Some problems will have a fairly straightforward solution, while others will be more complex.

If a developer wishes to make FHA loans available to future buyers, what must she keep in mind when working on a development

Building codes and standards

Technology poses risks for everyone, but real estate licensees need to be especially careful. Which of the following is true about risks related to computer systems?

Client data can be exposed when a brokerage's computer system is compromised.

Jorge works at a firm where elected officers govern the affairs of the organization, while a licensed broker, Shonda, is directly responsible for the real estate transactions. The officers and Shonda are responsible to a large number of stockholders. What type of legal structure is this?

Corporation

A(n) ______ is certain to save a brokerage money

Culture of retention

Forecasters predict a huge spring blizzard. Jarrod's not concerned about operations because everyone could use a couple of days off, anyway. The snow will melt eventually. What long-term issues could arise that would cause more damage than Jarrod realizes?

Damage to the building from the storm and melting snow could destroy Jarrod's office and records.

Which of these leadership traits is useful in a crisis and in establishing work flow?

Decisiveness

Soriyah has most of the qualities needed to be a an effective leader, but she won't let other licensees lead sales meetings. What quality of an effective leader is she lacking?

Delegator

What's the purpose of a job description?

Describes how a person in a position relates and interfaces with others.

Coercive and ____ management styles are similar in their demand for action.

Dictatorial They're effective in crises and when an employee or a group needs brought into line.

What's an obstacle to working with culturally diverse populations?

Different language

______ in a brokerage may include a variety of skills, language, personalities, and cultural backgrounds.

Diversity

In which of the following scenarios is impossibility of contract performance occurring?

Due to circumstances beyond their control, the parties can't legally or practically do what they've agreed to do.

A broker is training all affiliated licensees on a recent change in fair housing laws. Why should she deliver the training to new licensees separately from experienced salespeople?

To prevent new people from getting lost in details they don't understand, and to save experienced people from sitting through explanations they don't need

With this type of commercial lease, the tenant typically pays the taxes, insurance, and maintenance expenses.

Triple Net lease With a gross lease, the landlord typically pays these expenses. With a triple net lease, the tenant pays all three. To help you remember this, the first letter in the three expenses (taxes, insurance, and maintenance) spell out TIM.

Risk mitigation means ______

Using a system to reduce the risk's likelihood or severity

Katrina and Greg are selecting a firm and a licensee to help them sell their home. They're comparing commission-based and flat-fee listing services. The commission-based service will cost more, but they'll have a licensee who performs most of the work. The flat-fee listing service costs much less, but they'll have to do more of the work. What marketing model concept will their decision represent?

Value Katrina and Greg are comparing the overall value of the services they will use to sell their home.

Leaders communicate and live by their ______.

Values

Which of the following is a characteristic of centralized organizational structures?

Vertical chain of command

What legal concept relates to a broker's responsibility for licensee misconduct?

Vicarious liability

A broker wants his associates to know how an appraiser performs a physical inspection of a property so they'll e more familiar with the information they see in an appraisal report. Which of the following delivery options would make this training mot effective for his associates?

Video A video allows learners to see the physical details of the appraiser's inspections without requiring each individual to be present tat the property being appraised.

As the supervising broker, tanner makes sure that the firm's policies and procedures manual is updated regularly and is enforced. He provides formal and informal training on the manual's contents. Does this relieve Tanner of vicarious liability if a licensee performs an unethical act?

No. However, in some situations, Tanner's attempts at training and enforcement may help lessen sanctions against him. Though technically Tanner is responsible, if he can prove that the firm has policies and procedures in place and that he provides training and coaching to licensees, he may receive less blame than he might otherwise.

What's the most important determining factor for the type of office the brokerage needs and the systems required?

Purpose of business

Which of the following business names would be the most likely outcome of a merger between Duck Realty and Rooster Realty

Quack-a-Doodle-Doo Realty

Which of the following is a good example of proper safety and security measures for employees at a brokerage office?

Require identification from customers and clients before real estate professionals go into the field with them.

In a broker/independent contractor relationship, the broker is primarily concerned with what?

Results A broker/independent contractor relationship is one in which the broker is primarily concerned with the end result of listing and selling property, and leaves the day-to-day decisions on how things are done to the salesperson.

Which of the following demographic data points would a brokerage be most interested in when evaluating a market?

Employment Level

Which of the following has the legal effect of preventing a person from making a claim based on her prior behavior or statements?

Estoppel

There are four key federal government controls that can potentially affect development and investment projects: _____; EPA-required environmental review; the protection of wetlands; and the protection of endangered species.

FHA approval for subdivisions that plan to allow FHA financing FHA approval for subdivisions that plan to allow FHA financing is one of the four federal government controls that can affect development and investment projects.

Which act created an agency to investigate antitrust practices?

Federal Trade Commission Act The Federal Trade Commission Act created the FTC. This agency investigates practices and will stop companies and individuals from committing antitrust violations.

If you need an employee to take charge of a commuity service project, which personality type would be your best pick for the project?

Feelers Feelers are the people in your office who are always looking out for everyone else. This is the personality type that is perfect for heading up your community service project.

Which of the following represents a reason for maintaining complete transaction files?

Files can be used for operations analysis. Retention of transaction files is important for two reasons: to meet state regulatory requirements and to analyze business operations.

Mortgage Fraud is considered __

Fraudulent misrepresentation Mortgage fraud is a form of fraudulent misrepresentation that, because it's become so prevalent, has been named as its own category of fraud.

Loronda is working on her business plan in preparation for opening her own brokerage. Why should she consider including succession planning in her plan?

It helps to ensure that well-trained talent is available in the event that a critical position becomes vacant. Succession planning not only ensures that a solid pipeline of qualified individuals is ready to move into critical positions, but it also motivates staff to perform at a high level in order to e considered for promotion.

When a website has an S in the "http" portion of the URL, such as: "https://www.google.com," what does it mean?

It is a secure website.

Although training delivered via a recorded webinar may not be very engaging for a learner, it does have one advantage over other training delivery methods. What is it?

It's budget-friendly for the brokerage when a large, physically dispersed audience is involved.

Vicarious Liability

Liability for someone else's acts or omissions

As manager of the sales team, Judy has direct responsibility for reaching the company's financial goals. What type of authority does Judy have?

Line (Judy has line authority because she's directly responsible for achieving the company's financial goals.)

Marc is working on the "blueprint" for his brokerage, which is another term for the brokerage's ______.

Long-range plan The terms "blueprint" and "long-range plan" are used interchangeably in business.

Broker Tiffany does her best to make her licensees satisfied they've affiliated with her, in part because replacing them costs her brokerage in time, expense, and _____

Lost productivity

Broker Millie wants to start her own brokerage. The market is hot right now, and she wants to get her brokerage up and running ASAP. Once things slow down a little, she'll figure out a business plan and other details. Which of the following is true of this situation?

Making a plan and implementing it is essential to the future success of an organization.

Retaining paper and electronic records of transactional documents for the time period prescribed by your regulating authority helps to ______ risk.

Manage

When discussing a merger, what would corporate cultural fit relate to?

Management Style

Which of the following is a good cash management technique?

Match revenue and expenses with cash flow.

Mortgage Fraud is considered

Misrepresentation

How may a broker effectively manage the firm's cash flow and expenses?

Review, plan, and forecast proactively

Why is error and omissions insurance recommended for all licensees?

Risk is and inherent part of real estate activities. E&O insurance is necessary for all licensees because risk is an inherent part of real estate activities.

Offer to purchase, sales agreement, contract of purchase and sale, and purchase agreement are other names for the ______.

Sales Contract

Which of the following establishes requirements for employers to provide a safe and healthy workplace for their employees?

The Occupational Safety and Health Act The Occupational Safety and Health Act primarily addresses the rights of employees, not independent contractors. The self-employed aren't covered under OSHA.

Which of the following statements is true regarding licensees who work at a limited function referral organization?

The licensees don't do any active selling. The licensees at an LFRO gather referrals and feed them to a full-service brokerage but don't do any active selling.

What is the relationship between the marketing department's efforts and those of other departments in the firm?

The marketing department is an integral component of the firm's activities.

Which of the following is one of the key decisions a brokerage makes when deciding how to staff the sales force?

The number of licensees to use

Which of the following is one of a firm's best defenses against damage to its image

The policies and procedures manual

Olivia, the owner of Your Home Brokerage, develops a goal for all of her licensees: Increase sales by 15%. Is this a SMART goal?

No, because it's not time-based.

Broker Craig fires salesperson Enrique for violating a provision of the license law. Which of the following is true of this situation?

This is a valid reason to terminate the licensee's affiliation with the broker.

Jennings has received a Closing Disclosure from his lender. What's the purpose of this form?

To detail all costs Jennings will owe at closing

Which of the following is a good reason to merge with or acquire another company?

To form a larger company that is more competitive

A variable expense budget, monthly operating budget, or profit center budget is prepared using the ___ as a basis.

general operating budget

How is organic growth defined?

The growth of a business through the gradual adoption of new services and increases in market share

One drawback to franchises is ___

They require you to pay franchise fees.

Which entity has the authority to represent the state and citizens of the state in antitrust cases?

Attorney General The attorney general may bring federal antitrust suits on behalf of individuals who live within the state, through the legal concept of parens patriae, or on behalf of the state as a purchaser.

Carmen's original one-year commercial lease has ended, and now, with her landlord's permission, she has gone into a month-to-month lease situation. What type of clause was in the original lease agreement that enabled this situation to occur?

Automatic renewal This situation is an example of an automatic renewal clause.

Which of the following is an industry trend that a brokerage should track?

Average days on market

Arnold plans to open a brokerage. What might make him select a sole proprietorship legal structure?

He wants control over branding. Sole proprietorships offer complete control but no personal protection.

Georgio, a managing broker, has just increased the size of his firm from 2 to 13 licensees. What can he expect?

He'll have less time to grow the business. As a business grows and more staff is hired, the broker-owner must spend more time managing sales staff and less time on activities to grow the business. With more sales staff, revenue responsibility is shared.

A ______ analyses of the balance sheet and its related ratios provides the clearest picture of a firm's financial health.

Historical To gain a true view of firm's financial position, evaluate the current and previous

What impact do marketing efforts have on sales?

Indirect Marketing is a strategic process that impacts all departments in a firm. Its impact on sales is critical, but indirect

The compensation plan at Giny's brokerage makes pay levels consistent with their level of responsibility, so that people are paid fairly when compared to what others at her brokerage do. What is this called?

Internal equity compensation plans should be fair from both an external and internal perspective. Internal equity means workers are paid fairly in relation to the work they do, and when compared to others who work there.

Harriet is a hard worker. Of all of the unlicensed staff, she receives the most consistently positive evaluations from her boss. She's the face of the firm, greeting walk-in and telephone clients with a friendly, efficient manner. She knows exactly where to find anything and any information she and her colleagues need. What's the first question managers should ask when determining if Harriet is suitable for promotion?

Is she interested in promotion? Before spending time to evaluate Harriet's skills related to promotion, managers should find out if Harriet is even interested in being promoted.

Which of the following is true about errors and omissions insurance

It covers licensees sued by consumers for inadvertent mistakes.

Which of these describes a decentralized management system?

It has a horizontal structure. A decentralized structure is more efficient for larger organizations. There are few levels of management at the top.

Broker Sam has extended an offer to licensee Jane, who has accepted the offer. Jane will work as an independent contractor for Sam. Based on this, which of the following statements is true?

Jane will need to fill out a W-9 for IRS reporting purposes.

Which of the following is a good way to ensure safety and security of properties listed by your brokerage?

Keep keys locked in a secure location.

Everything in your office is potentially at risk from thieves and other criminals. Because of this, what should you never do?

Leave clients unattended in the office.

Rust Brokerage is run as a lean machine and requires its employees to be both productive and cost-efficient. It pays employees on a scale that relates their worth to how much their work has contributed to overall revenue. This reflects a(n) ______ compensation philosophy.

Performance

Which special lease clause stipulates that the tenant is responsible for paying any increase in taxes over the base year's taxes, in addition to the base rent?

Tax Because property taxes increase at a constant rate in many areas, the tax clause is becoming increasingly common in office leases—even on short-term leases.

Samantha is a real estate licensee. She's showing her client a property. The client asks about some spots on the ceiling and wonders if they're an indication of a roof leak. What should Samantha do?

Suggest that her client contact a roofing expert to make a determination.

A broker must ______ independent contractors.

Supervise Independent contractors are to be supervised, not managed or directed.

Is this true, false or something else? "With respect to persons with disabilities, the Fair Housing Act regulates housing-related issues, and the Americans with Disabilities Act regulates issues related to public spaces. "

TRUE The ADA doesn't apply to residential housing. Instead, it applies to public places such as stores, restaurants, and office buildings.

Which of the following business planning activities breaks the long-range plan down into smaller tasks and identifies which segment(s) of the company are responsible for doing what?

Tactical planning Tactical planning is the most granular level of planning. Once the long-range plan has been broken down into smaller tasks, the management and staff are responsible for carrying out the tactics.

You're a broker, and lately you've noticed that three of your licensees seem to be constantly sniping at each other. It's affecting everyone at the brokerage. What should you do?

Talk to them each individually to clarify the situation.

Two large local brokerage firms agreed to lower their commission rates to the same amount—approximately 1% less than any other firm in town. After extensive marketing of their new lower rate, these two firms began to see a big increase in the number of listings they received, costing their competitors substantial amounts of money. What about this situation makes it a per se antitrust violation?

The agreement between the two firms

Which of the following itemizes income to expenses for given month?

The cash flow statement The cash flow statement helps match income to expenses for any given month, indicating whether additional cash will be needed.

A general business objective is designed to expand on which of the following?

The company's mission statement

A market analysis can help you decide which office and business systems you need. Which of the following can be determined from your market analysis?

The services your customers want

What is a SWOT analysis useful for determining?

The strengths, weaknesses, opportunities, and threats facing a business

A broker wants to make sure that her sales associates can perform as effectively as possible. She uses a solid business model and a clear business mission; she communicates expectations to her licensees; she recognizes their efforts and compensates them fairly; and she provides the training they need. What else should she make sure her licensees have to allow them to perform at their best?

The technology tools and physical environment that the job requires

Which of the following statements about enforcing a firm's code of ethics is true?

There should be consequences for violating the firm's code of ethics, and these consequences should be communicated and documented.

Who has the best information about your firm's operations to assist in writing your disaster recovery plan?

You and your staff