GREC Post License Course

Funds in the escrow account may be dispersed for any of the following reasons EXCEPT when: a. All principals to the transaction agree in writing to the disposition. b. A court orders disbursement of the funds. c. The seller demands forfeiture of the earnest money deposit. d. The transaction is consummated.

c. The seller demands forfeiture of the earnest money deposit.

What is the purpose of the assignability clause in the standard Exclusive Buyer Brokerage Agreement? a. It allows the buyer to assign the contract to another buyer; b. It allows the broker to assign the contract to another broker for any reason; c. It allows the broker to assign the contract to another broker if the firm is sold; d. None of the above.

c. It allows the broker to assign the contract to another broker if the firm is sold;

The process of getting ready to show homes would include each of the following steps, EXCEPT: a. Making sure your lockbox key is up to date; b. Making an information packet; c. Preparing an offer form for each property; d. Previewing the houses

c. Preparing an offer form for each property

Broker Bob represents both the seller and the buyer as agent in the same transaction. Which of the following statements is correct? a. This arrangement is always illegal. b. This arrangement is never illegal. c. This arrangement is only legal with the informed consent and written permission of both the buyer and the seller. d. This arrangement is legal only in a few states.

c. This arrangement is only legal with the informed consent and written permission of both the buyer and the seller.

What is a VOW? a. A Very Open Window - which is a type of real estate franchise. b. A Visual Organizing Window - which is a product used to create 3-dimentional digital walk-throughs for real estate licensees. c. A type of illegal boycott. d. A Virtual Office Website - which often is a discount real estate brokerage.

d. A Virtual Office Website - which often is a discount real estate brokerage.

What offers must a listing broker present to a seller? a. Only written offers and only until the seller has accepted an offer b. Only written offers received prior to closing. c. All offers, only until the seller has accepted an offer. d. All offers received prior to closing.

d. All offers received prior to closing

Which of the following actions by a licensee who is working with a consumer as a non-client could cause the creation of an agency by implication? a. Filling in the blanks on a pre-printed offer to purchase real property. b. Showing homes to a consumer which meet the consumer's specified needs and desires. c. Making arrangements for a home inspection to take place. d. Making a recommendation about whether to make or accept a counteroffer.

d. Making a recommendation about whether to make or accept a counteroffer

The commission rate for arranging a lease is most likely to be on a declining scale for which type of commercial real estate? a. Office space. b. Industrial space. c. Medical office space. d. Shopping centers.

B. Industrial space

Depending on state law, a transaction broker might have each of the following obligations to the consumer, EXCEPT: a. Limited confidentiality. b. Loyalty. c. Using skill, care and diligence. d. Accounting for all funds.

B. Loyalty

A seller contacted 3 brokers and asked each to suggest the listing price for his property. Broker A said $78,000. Broker B said $79,000. Broker C said $91,000. The seller listed with Broker C and the house later sold for $76,000. Broker C is guilty of violating which of his or her agency responsibilities? a. Loyalty. b. Reasonable care. c. Disclosure. d. Accountability.

B. Reasonable care

What is the greatest risk in a case where a buyer's agent submits offers on several homes simultaneously? a. The licensee would have violated federal law. b. The buyer could be contractually obligated to buy more than one house and could face damages if defaulting on any of the contracts. c. The licensee could develop a bad reputation in the community. d. None of the above.

B. The buyer could be contractually obligated to buy more than one house and could face damages if defaulting on any of the contracts.

A buyer makes an offer on a listed property with a five day expiration date. On the fourth day the seller makes a counteroffer to the buyer on the third day and the buyer rejects the counteroffer that day. The seller then agrees to accept the original on the fourth day after the buyer delivered the original offer. Which of the following statements is correct? a. Since the seller accepted the original offer prior to the expiration date, the buyer is bound by the original offer; b. The counteroffer terminated the original offer and the buyer is under no obligation to purchase the home; c. Since the seller did not reject the original offer the original offer was still in effect and the buyer is bound to the contract; d. State law gives the seller two business days after making the counteroffer to accept the original offer.

B. The counteroffer terminated the original offer and the buyer is under no obligation to purchase the home;

Why is it important to determine if a prospective buyer is already working with another real estate licensee? a. Georgia state law requires the question to be asked; b. To avoid commission disputes; c. To determine if you can talk them into cancelling an existing brokerage agreement; d. To determine what homes they have already seen.

B. To avoid commission disputes

Which of the following statements regarding the commission to the broker in an Exclusive Buyer Brokerage Agreement is correct? a. The broker is entitled to a commission if the buyer purchases a property after the listing expires but was shown that property during the term of the listing b. Commissions paid by a FSBO owner to the broker would reduce any commission owed to the broker by the buyer c. If the buyer defaults on a purchase of a home initiated during the term of the listing, the broker has earned the commission d. All of the above.

D. All of the above

Broker Betty has a listing on Seller Sally's house. Purchaser Paul makes an offer through Broker Betty and puts up a $15,000 deposit. Seller Sally gives Broker Betty her deed to the house and her title insurance policy. Broker Betty must document the disposition of: a. The $15,000 deposit; b. The deed; c. The title insurance. d. All of these choices.

D. All of these choices

A broker could return the buyer's deposit from the escrow account back to the buyer in which of the following cases? a. The offer expired without any acceptance by the seller. b. The seller rejected the buyer's offer. c. The transaction was cancelled because of the buyer's inability to meet the financing contingency and the seller consented to returning the deposit. d. Each of the above.

D. Each of the above

In determining whether or not to issue a preapproval letter, the lender would consider: Select one: a. Interest payments only; b. Principal payments only; c. Principal and interest payments only. d. Principal, interest, property taxes and insurance.

D. Principal, interest, property taxes and insurance

Broker Johnson has listed the property of Cheever and sells it to Brevard for $175,000. Before closing, Johnson finds that the property has a serious structural defect. What should Johnson do? a. Tell Cheever. b. Tell Brevard. c. Keep it quiet as it might kill the sale. d. Tell both Cheever and Brevard.

D. Tell both cheever and brevard

When a buyer takes out a conventional loan, which of the following statements about the seller's contribution to the buyer's closing costs is correct? a. There is no limit; b. Sellers are prohibited from contributing to the buyer's closing costs; c. There are limits to the seller's contribution which are based on the price of the house; d. There are limits to the seller's contribution which are based on the buyer's down payment.

D. There are limits to the seller's contribution which are based on the buyer's down payment.

The normal way that a buyer's agent would present an offer to a seller in Georgia is: Select one: a. The buyer's agent presents the offer directly to the seller; b. The buyer's agent presents the offer to the seller's agent (or broker); c. Either of the above; d. None of the above.

B. The buyer's agent presents the offer to the seller's agent (or broker);

When showing houses to a buyer, it is good practice to use each of the following strategies, EXCEPT: a. Act as more of a consultant than a salesperson b. To give the buyers your opinion about the houses c. To encourage the buyers to say what they don't like as much as what they like? d. Spend more time listening to the buyers than talking to the buyers.

B. To give the buyers your opinion about the houses

A system of laws based on regulations passed by a regulatory agency is known as: a. Common law. b. Statutory law. c. Administrative law. d. Commission law

C. Administrative law

A system of laws based on regulations passed by a regulatory agency is known as: a. Common law. b. Statutory law. c. Administrative law. d. Commission law.

C. Administrative law

The Department of Housing and Urban Development and the Consumer Financial Protection Bureau play a role in: a. Common law. b. Statutory law. c. Administrative law. d. Commission law.

C. Administrative law

What is the best strategy for dealing with advantages and disadvantages of a particular home? a. Always disclose both advantages and disadvantages prior to showing the house. b. Always disclose the advantages, but not the disadvantages, prior to showing the house. c. Always disclose the disadvantages, but not the advantages, prior to showing the house. d. Never disclose either the advantages nor the disadvantages prior to showing the house.

C. Always disclose the disadvantages, but not the advantages, prior to showing the house.

A real estate licensee would have what duties to a third party? a. To treat customers honestly and fairly. b. To disclose all material adverse facts about the property and the transaction. c. Both of the above. d. None of the above.

C. Both of the above

If a property is condemned for eminent domain purposes, which of the following contracts would be terminated by operation of law? a. A listing contract on the property. b. A purchase contract on the property. c. Both of the above. d. None of the above.

C. Both of the above

In states where dual agency is legal, which of the following are requirements to create a dual agency? a. There must be disclosure of the dual agency. b. There must be written consent from both the buyer and the seller. c. Both of the above. d. None of the above.

C. Both of the above

Money or trust instruments received, accepted or held pending consummation or termination of a real estate transaction are: a. Commissions. b. Down payments. c. Escrow funds. d. Anticipated profits

C. Escrow funds

A market in which there is only one producer of a product is called a: a. Monopsony. b. Oligopoly. c. Monopoly. d. None of the above.

C. Monopoly

A broker who takes a listing on a house would most likely be a: a. Universal agent. b. General agent. c. Special agent. d. Subagent.

C. Special agent

Lenders generally want to see that the debt-to-income ratio does not exceed what percentage of gross income? Select one: a. 28%. b. 31%. c. 39%. d. 43%.

D. 43%

Which of the following types of sales of a personal residence would require a third-party approval before the sale could be closed? a. A bankruptcy only; b. A bankruptcy or a divorce; c. A sale of a home with an existing mortgage; d. A bankruptcy, a divorce or a short sale.

D. A bankruptcy, divorce, or short sale.

When showing a property to a prospective buyer, which of the following statements is/are true? a. Not talking too much allows you to better listen to the buyer; b. You should tell the buyer to inform you of anything they don't like; c. Body language can often tell you more than words; d. All of the above.

D. All of the above

Which of the following choices are included in the list of preparation for showing homes to a prospective buyer? a. Plan your route b. Make an information packet c. Preview the homes d. All of the above.

D. All of the above

Broker Bob has a buyer agency agreement with Buyer Bill. The agreement calls for Buyer Bill to pay a 3% commission upon closing of the purchase of a home. Buyer Bill purchases Seller Sally's house. Seller Sally gave an exclusive right to sell listing agreement to Broker Betty and agreed to pay a 6% commission. In a typical transaction of this nature, how much commission will Buyer Bill have to pay to Broker Bob? a. 6% of the purchase price. b. 3% of the purchase price. c. 1% of the purchase price. d. Nothing.

D. Nothing

A real estate licensee represents himself to a customer as the agent of a seller without the knowledge of the seller. The customer makes an offer on the property, which the licensee then presents to the seller. The seller accepts the offer and agrees to pay a commission to the licensee. This is an example of: a. Agency by ratification. b. Agency by estoppel. c. Implied agency. d. General agency.

A. Agency by ratification

Undisclosed dual agency is illegal in how many states? a. All 50. b. 42 states. c. 26 states. d. 8 states.

A. All 50

The Sherman Antitrust Act prohibits each of the following activities, EXCEPT: a. Commingling. b. Price fixing. c. Boycotts. d. Tying arrangements

A. Commingling

A buyer has made an offer on a seller's house. The offer gives the buyer 10 days to have a licensed home inspection of the property and to cancel the offer if the inspection reveals significant necessary repairs unknown to the buyer. This is an example of a/an? a. Contingency clause b. Addendum clause c. Assumption clause d. Habendum clause

A. Contingency Clause

If a buyer makes an offer with a five day expiration date and the seller does not accept the offer within that time period, which of the following statements is correct? a. The buyer is under no obligation to buy the house; b. The buyer can sue the seller for failure to reject the offer; c. The buyer is bound by the offer; d. None of the above

A. The buyer is under no obligation to buy the house

Which of the following statements is true regarding a letter of prequalification or preapproval from a lender? a. The letter would take into account principal, interest, taxes and insurance; b. The letter will include an automated valuation of the property; c. The process would include income and asset validation; d. All of the above.

A. The letter would take into account principal, interest, taxes and insurance;

Which type of agent would most likely need a power of attorney? a. Universal agent. b. General agent. c. Special agent. d. Subagent.

A. Universal agent

What is an effective responses to a buyer who says, "I want to think it over?" a. "Is there something specific that you are concerned about?" b. "You are making a mistake." c. "You don't want to miss this deal?" d. Any of the above

a. "Is there something specific that you are concerned about?"

A real estate broker is making a listing presentation to a potential client and states that she charges a 6% commission if the house is sold. The homeowner asks why she charges that much commission. Which of the following statements would be a recommended response? a. "We believe that we are worth the cost of the commissions because of our proven track record in this community." b. "Our commission rate is the standard rate charged in this area." c. Either of the above. d. None of the above.

a. "We believe that we are worth the cost of the commissions because of our proven track record in this community."

When a licensee asks a potential buyer "Would you like to ask the sellers to include the patio furniture with the sale when we make the offer?", that is an example of: a. An assumptive close; b. An impertinent question; c. A directive question; d. Puffing.

a. An assumptive close

What is the primary risk associated with in-house sales? a. An undisclosed dual agency. b. The risk that one of the clients might seek representation by another firm. c. The risk of violating the law against commingling. d. None of the above.

a. An undisclosed dual agency

Appraisers and real estate licensees who are estimating property values in a neighborhood will use information on expired listings to give an indication of: a. The upper limit of value. b. The lower limit of value. c. The market value. d. The insurance value.

a. The upper limit of value

Which of the following would be included in the duties of an agent to a customer? a. To disclose material adverse facts about the property. b. To maintain the confidentiality of information provided to the agent. c. Both to disclose material adverse facts about the property and to maintain the confidentiality of information provided to the agent. d. Neither to disclose material adverse facts about the property nor to maintain the confidentiality of information provided to the agent.

a. To disclose material adverse facts about the property.

In addition to the prevention of commingling of funds, the purpose of the requirement for brokers to place customer funds in an escrow or trust account is to: a. To protect consumers from the business risks associated with the brokerage firm. b. To earn a higher rate of interest on deposits. c. To make it easier for regulators to determine compliance with the regulations. d. None of the above.

a. To protect consumers from the business risks associated with the brokerage firm.

Which of the following real estate brokers would NOT be required to maintain an escrow or trust account? a. A firm which deals only with commercial real estate. b. A firm which never holds funds belonging to clients or customers. c. A firm that never holds more than $10,000 of customer funds. d. None of the above - all firms are required to maintain an escrow or trust account.

b. A firm which never holds funds belonging to clients or customers.

The death of a seller would terminate which of the following contracts? a. A purchase contract. b. A listing contract. c. Both of the above. d. None of the above

b. A listing contract

Which of the following clauses in an offer to purchase a property would be most attractive to a buyer who makes several simultaneous offers to purchase a residence when the buyer can only purchase one of them? a. A liquidated damages clause. b. An unrestricted right to terminate the contract for a limited period of time. c. An inspection contingency. d. A financing contingency.

b. An unrestricted right to terminate the contract for a limited period of time.

Assuming the buyers ride in your car, the time spent in the car can be put to good use by: Select one: a. Taking the most direct route; b. Discussing the positive features of the neighborhood; c. Getting to each property as quickly as possible; d. Making small talk to relieve the pressure.

b. Discussing the positive features of the neighborhood

The period of time that a buyer has during which the buyer can terminate the Purchase and Sale Agreement is called the: Select one: a. Rescission period; b. Due diligence period; c. Termination period; d. Bail-out clause.

b. Due diligence period

Under common law, a broker who has a listing is in a position of trust and must put his or her interests above those of all others. This describes what type of obligation? a. Vicarious obligation. b. Fiduciary obligation. c. Duty of care. d. Substitutional obligation.

b. Fiduciary obligation

Property owner Kilmer, who is living overseas, lists his property with Broker Huff. Later the land is rezoned for a higher use, increasing its value. Huff buys the property herself and sells it six months later. Which of the following is true? a. As long as Huff informs Kilmer of her intent to buy the property before she does so, her action is above reproach. b. Huff can buy the property only after informing Kilmer of the zoning change and the effect that it has on the property. c. Huff cannot legally act for someone who is overseas. d. When Huff resells the property in six months, she has a legal obligation to inform Kilmer.

b. Huff can buy the property only after informing Kilmer of the zoning change and the effect that it has on the property.

When using a checklist of questions to determine a buyer's wants and needs, why is it a good idea to ask questions about why the buyers answered a question the way they did? a. So you can let them know where you disagree; b. So you can learn more about what they want or don't want; c. So you can inform them that you know of no homes in the area that meets that requirement; d. So you can better determine a price range.

b. So you can learn more about what they want or don't want

Broker Bob has a listing on Seller Sally's house. A buyer has made an offer on the property which Seller Sally accepted. The buyer later defaults on the purchase agreement. What compensation would Broker Bob most likely receive? a. No compensation. b. The lesser of the full commission based on the price in the contract or 50% of the damages received by the seller. c. 50% of the full commission based on the price in the contract. d. The full commission based on the price in the contract.

b. The lesser of the full commission based on the price in the contract or 50% of the damages received by the seller.

A real estate broker owns some vacant land which it sold to a real estate developer who intended to build single-family residences on the land. The broker includes a clause in the sales contract stating that the developer was required to list the completed homes with the real estate broker. Which of the following statements is correct? a. This is a tying arrangement and is legal. b. This is a tying arrangement and is illegal. c. This is a boycott and is illegal. d. This is a bid rigging system and is illegal.

b. This is a tying arrangement and is illegal.

Licensee Laurie makes a listing presentation to Seller Steve. Steve agrees to give Laurie a listing and agrees to pay her a commission upon sale, but refuses to sign any written contract. How was this agency relationship created? a. There is no agency relationship since it is not in writing b. This is an expressed agency c. This is an implied agency d. This is agency by ratification

b. This is an expressed agency

What is the purpose or effect of the equal dignities rule? a. To strengthen the fair housing laws. b. To require that if the underlying contract must be in writing, any related contracts must be in writing. c. To require a modicum of civility in business relationships. d. None of the above

b. To require that if the underlying contract must be in writing, any related contracts must be in writing.

In which of the following cases could there be damages awarded? a. Termination by expiration. b. Unilateral termination by either party. c. Termination by mutual agreement. d. Termination by operation of law.

b. Unilateral termination by either party.

The duty of an agent to follow the instructions of the client applies to each of the following instructions, EXCEPT: a. "Do not show the house on Sundays." b. "Do not put a lockbox on my door." c. "Do not reveal to any buyers that my roof leaks." d. "Do not allow buyers to wear shoes inside the house."

c. "Do not reveal to any buyers that my roof leaks."

If one party to a listing contract unilaterally terminates a listing contract. The other party sues for damages. In order to not be liable for damages, the party that terminated the contract must: a. File for bankruptcy. b. Counter sue. c. Be able to prove that the termination was for "just cause." d. None of the above, there is no defense.

c. Be able to prove that the termination was for "just cause."

If a buyer died after receiving acceptance of an offer by the seller but prior to the close of the transaction, the transaction would be LEAST likely to close: a. If the offer was an all-cash offer. b. Under any circumstances, since the death of the buyer would always terminate the contract. c. If the offer included a mortgage to finance the purchase. d. Under any circumstances, since the purchase would always be enforceable against the estate of the buyer.

c. If the offer included a mortgage to finance the purchase.

When would a seller insist on a "kick-out" clause? a. If an offer has a due diligence period; b. If the offer has a financing contingency; c. If the offer is contingent on sale of the buyer's current residence; d. If the offer has an appraisal contingency.

c. If the offer is contingent on sale of the buyer's current residence

The state law that specifies which types of contracts must be in writing to be enforceable is called the: a. Statute of Writings. b. Statute of Determination. c. Statute of Limitations. d. Statute of Frauds.

c. Statute of Limitations

Brokers must hold their client's funds in a/an: a. Office safe. b. Savings account. c. Trust or escrow account. d. Special account managed by the Board of Realtors

c. Trust or escrow account.

A good approach for handling buyer's remorse is to: a. Remind them that they are contractually obligated to purchase the house; b. Scold the buyers for their concerns; c. Use Ben Franklin's approach of analyzing the pros and cons of their decision; d. Take the buyers out to lunch.

c. Use Ben Franklin's approach of analyzing the pros and cons of their decision;

The consequences of an undisclosed dual agency could include: a. Disciplinary actions by the state regulatory agency that could include suspension or revocation of the license. b. Either the buyer or the seller could rescind the transaction. c. A suit for damages by either or both of the clients. d. All of the above.

d. All of the above.

A licensee who left the real estate business in the early 1980s and returned in the mid-1990s would be likely to notice which of the following changes in the real estate business? a. A steep decline in the use and acceptability of subagency. b. A rise in the use and acceptability of buyer agency. c. An increased number of agency disclosure requirements. d. All of these choices.

d. All of these choices

Which of the following statements about a seller's obligation to provide information to an agent is true? a. The seller needs to give the agent information about the property. b. The seller needs to give the agent information about the seller's financial expectations. c. The seller's obligation to give information can continue after the listing contract has been signed. d. All of these statements are true.

d. All of these statements are true

Each of the following will automatically terminate a listing by operation of law, EXCEPT: a. Bankruptcy of the client. b. Destruction of the property. c. Condemnation of the property. d. Client's decision.

d. Client's decision

There are two real estate companies in the City of Oz. The two firms agree that one firm will list only homes above $500,000 in market value while the other firm will list only homes under $500,000 in market value. Which of the following statements is correct? a. This is a tying arrangement and is legal. b. This is a tying arrangement and is illegal. c. This is market allocation and is legal. d. This is market allocation and is illegal.

d. This is market allocation and is illegal

A system of laws which are based on precedent-setting court decisions is known as: a. Common law. b. Statutory law. c. Administrative law. d. Commission law.

A. Common law

What is a typical indication that a potential buyer has a fear of making a decision? a. The objections the buyer gives are very vague b. The objections the buyer gives are quite specific c. The buyer is more talkative than usual d. The buyer is less talkative than usual.

A. The objections the buyer gives are very vague

The legal description of the subject property must appear in which of the following contracts a. Exclusive Seller Listing Agreement b. Purchase and Sale Agreement c. Both of the above d. None of the above

C. Both of the above

What is a way to take steps to prevent buyer's remorse from happening? a. Tell them in advance that buyer's remorse is common in any large purchase and it doesn't mean they made a mistake; b. Throughout the process, make sure they understand the costs and monthly payments they will incur; c. Both of the above; d. None of the above.

C. Both of the above

When showing several properties to some potential buyers, how does the printed review sheet with the list of homes shown benefit the buyers? a. It helps them remember the key features of each house. b. It allows them to make notes on the review sheet. c. Both of the above. d. None of the above.

C. Both of the above

Which of the following ratios used for analyzing a mortgage application would take into consideration the property taxes the buyer would be expected to pay on the property purchased? a. The housing ratio. b. The debt-to-income ratio. c. Both of the above. d. None of the above

C. Both of the above

Which of the following ratios used for analyzing a mortgage application would take into consideration the property taxes the buyer would be expected to pay on the property purchased? a. The housing ratio. b. The debt-to-income ratio. c. Both of the above. d. None of the above.

C. Both of the above

Which of the following transactions would be considered an "in-house" sale? a. The same salesperson finds both the buyer and the seller. b. Two different salespersons who work for the same broker find the buyer and the seller. c. Both of the above. d. None of the above.

C. Both of the above

The phrase "swampland in Florida" has come to be associated with: a. Environmental restoration efforts; b. Alligator extermination efforts; c. Fraudulent investment schemes; d. Distressed property renovation.

C. Fraudulent investment schemes

If you are showing property you are listing and tell a prospective buyer that "...this property is the best for you," the relationship created could be interpreted as: a. Universal agency. b. Special agency. c. Implied agency. d. General agency.

C. Implied agency

A buyer client's duty of cooperation with the agent would include: a. Being reasonably available for viewing properties. b. Following the agent's advice regarding counteroffers. c. Both of the above. d. None of the above.

a. Being reasonably available for viewing properties

When using the Purchase and Sale Agreement form prepared by the GAR, the licensee may: a. Fill in the blanks in the contract b. Make significant modifications to the contract by crossing out paragraphs c. Both of the above d. None of the above

a. Fill in the blanks in the contract

A broker and salesperson owe all EXCEPT which of the following to the purchaser/customer? a. Negotiation of the lowest possible price. b. Honesty. c. Fairness. d. Disclosure of defects in the property

a. Negotiation of the lowest possible price

It would NOT be considered commingling of funds, if: a. The broker holds a deposit check at the request of the offeror until acceptance by the offeree. b. The broker holds a deposit check at the request of the offeror after acceptance by the offeree. c. The broker holds an earnest money deposit in his personal account until the offer is accepted or rejected. d. The broker holds an earnest money deposit in his brokerage operating account because the deal is going to be all cash.

a. The broker holds a deposit check at the request of the offeror until acceptance by the offeree

What is the primary criticism of designated agency from consumer groups? a. The broker is still a dual agent and may favor a buyer represented by a designated agent over other buyers so that the firm could collect both sides of the commission. b. The clients do not have consistent representation from the designated agents. c. It is illegal in many states. d. None of the above.

a. The broker is still a dual agent and may favor a buyer represented by a designated agent over other buyers so that the firm could collect both sides of the commission.

Fred and Wilma gave a listing contract to Broker Bob to sell their home and both signed the contract. Prior to receiving any offers, Fred died in an unfortunate bowling accident. What is the effect of Fred's death on the listing contract? a. The contract remains in effect. b. The contract would be automatically terminated by law. c. The contract would be in default. d. The contract would only be enforceable in a community property state.

a. The contract remains in effect

Fred and Ethyl are married and have made an offer to purchase a home. Several days after receiving notice of the seller's acceptance of the offer, Fred passes away. Which of the following statements is LEAST accurate about the likelihood of completing this purchase? a. The contract would be terminated by operation of law. b. The contract would be binding if the offer was for all cash. c. If the offer included a mortgage, it could close if Ethyl could qualify for the loan based only on her income. d. None of these statements is correct

a. The contract would be terminated by operation of law.

Buyer Betty has a buyer's agency agreement with Buyer Bill. Broker Bob showed Buyer Bill several properties and Buyer Bill has made an offer on one of them and the seller has accepted the offer. A couple of weeks later, Buyer Bill defaults on the contract, saying that he has changed his mind about buying a house. What commission is Broker Betty entitled to? a. The full commission stated in the purchase agreement because Buyer Bill has defaulted on the offer. b. One-half of the commission stated in the buyer's agency agreement. c. One-third of the commission stated in the buyer's agency agreement. d. No commission, since Buyer Bill did not default on the offer.

a. The full commission stated in the purchase agreement because Buyer Bill has defaulted on the offer.

If a seller has given a listing to a broker and subsequently files for bankruptcy, which of the following answers best describes the impact on the listing? a. The listing will be terminated by operation of law. b. The listing will be transferred to the bankruptcy course as principal. c. There will be no effect on the listing. d. The listing period will be extended for the period of time the seller remains in bankruptcy.

a. The listing will be terminated by operation of law.

What is the purpose of using an assumptive close? Select one: a. To make it easier for the buyer to say yes; b. To better analyze the issue; c. To convince the seller to reduce the price; d. All of the above.

a. To make it easier for the buyer to say yes;

When a broker accepts a listing he or she has created an agency relationship. Which of the following is not an agency responsibility? a. To obey all the instructions of the seller. b. To use care in filling out contract forms. c. To be accountable for documents and funds. d. To be loyal to the seller.

a. To obey all the instructions of the seller.

Which of the following would be a violation of anti-trust law? a. Two brokers agree that each will market his services only in specific areas of the community. b. Jim, a broker, advertises that his firm will only represent buyers. c. An independent broker refuses to join the local Association of Realtors. d. A real estate company has some sales agents working as independent contractors and other sales agents working as employees.

a. Two brokers agree that each will market his services only in specific areas of the community

What is the purpose or effect of the equal dignities rule? a. To strengthen the fair housing laws. b. To require that if the underlying contract must be in writing, any related contracts must be in writing. c. To require a modicum of civility in business relationships. d. None of the above.

b. To require that if the underlying contract must be in writing, any related contracts must be in writing.

Designated agency would be most suitable for which of the following scenarios? a. A salesperson for a firm has both the seller's listing and the buyer's listing in the same transaction. b. Two different salespersons in the same firm have the buyer's listing and the seller's listing. c. Both of the above. d. None of the above.

b. Two different salespersons in the same firm have the buyer's listing and the seller's listing.

Broker Bob is holding a buyer's good faith deposit in his escrow account. The offer has an inspection clause which gives the buyer 10 days to have the home inspected and to rescind (cancel) the contract if the inspection reveals adverse facts. The inspector finds that the roof leaks and the buyer notifies the seller in writing of that decision. The seller maintains that the buyer is in breach of the contract. May Broker Bob legally return the buyer's good faith deposit? a. Yes, since his rescission was clearly permissible under the terms of the contract; b. Yes, in all cases. c. No, since the rescission was clearly not permissible under the terms of the contract. d. No, but Broker Bob could give it to a court through an interpleader action.

d. No, but Broker Bob could give it to a court through an interpleader action.