Chapter 2 (Set 1)

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...?

5500

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

Confidentiality

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

Cooperate with the agent

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...?

25350

David's house was listed at $465,000. The property eventually sold for $485,000. The agreed upon commission was 6%. How much did David pay as a commission at the closing of the property...?

29100

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 receives a 70/30 split with his broker, how much commission is paid to the real estate agent...?

7245

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

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

Agent - Appraiser

In a typical agency structure, a real estate salesperson is a sub-agent to whom...?

Broker

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

Appointing one or more individual agents in a firm to represent only the interests of the seller, and one or more different individual agents in the firm to represent only the interests of the buyer, when a firm has an "in-house" dual agency situation, is known as...?

Designated Sales Agent

According to an agent's fiduciary duties, the agent must present all offers to his/her client. Which of the following fiduciary duties best reflects this...?

Disclosure

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

Disclosure

If two or more brokerage firms conspire to not do business with another brokerage firm, what may they be liable of...?

Group Boycotting

It is strongly recommended that informed consent from a client be obtained in what manner...?

In-writing

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

In New York State, a referral fee may only be paid after this is obtained...?

Informed consent of the client

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

John is the Agent, Kevin is the Client, and Steve is the Customer

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

Landlord - Tenant

A person who has oral or written authority, either express or implied, to act for or on behalf of a landlord is known as...?

Landlord's Agent

According to which fiduciary duty is an agent prohibited from not showing a lower offer to the seller in an effort to obtain a higher commission...?

Loyalty

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

OLD CAR

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

Owner

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

An agent of a broker who is already acting as an agent of a principal is known as a...?

Sub-agent

If a principal or agent provides a customer with a material fact, which of the following must apply...?

The fact must be true and accurate

A contract where one transaction depends upon another is known as a...?

Tie-in Arrangement

In order to disclose confidential information, the agent must first obtain what from the client...?

Written consent

A general agent is typically granted more power than what other type of agent...?

Special Agent

In addition to the principal, the agent also owes fiduciary duties to which of the following...?

The Customer

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

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

Representing both principals (seller and buyer) in a transaction is known as...?

Dual Agency

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

According to this doctrine, a principal cannot claim that an implied agency relationship did not exist...?

Estoppel

An agreement of employment of a broker to the exclusion of all other brokers is known as...?

Exclusive Agency

An agreement of employment by a broker under which the exclusive right to sell for a specified period is granted to the broker is known as...?

Exclusive Right to Sell

An actual agency created by written or oral agreement between the principal and the broker is known as...?

Expressed Agency

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

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

Market Allocation

According to this doctrine, an agency relationship which is created after the fact when the principal agrees to be bound by the actions of the agent who was acting without authority, is known as...?

Ratification

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

Reasonable Care

The fiduciary duty that prohibits the agent from advancing any interests adverse to the principal's interest, or conducting the principal's business in such a way as to benefit a customer is known as...?

Undivided Loyalty

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

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

Loyalty

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

Misrepresentation

The employer of an agent or broker is known as a...?

Principal

As a general rule of thumb, compensation in New York State is set at what percentage of the sales price...?

6 (Percent %)

According to an agent's fiduciary duties, the agent must not change or modify the financial terms of a deal. Which of the following fiduciary duties best reflects this...?

Accountability

As a special agent in a transaction, a real estate salesperson cannot do which of the following on behalf of the owner...?

Negotiate the terms of the contract

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

Ely's house was listed for $225,000. The property eventually sold for $215,000. The agreed upon commission was 6%. How much did Ely pay in commissions at the closing of the property...?

12900

A written explanation, to be signed by a prospective buyer or seller of real estate, explaining to the client the role that the broker plays in the transaction is described on the...?

Agency Disclosure Form

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

Broker

An agent that cooperates or is engaged by a listing agent or a buyer's agent to assist in locating a property to sell or buy is known as a...?

Broker's Agent

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

Disclosure

According to this fiduciary duty, an agent cannot fail to reveal material information about a property in an effort to secure the sale...?

Disclosure

An agent with the full authority over one property of the principal, such as a property manager, is considered a...?

General Agent

Mr. and Mrs. Smith are seeking to sell their two bedroom house. Mark is a real estate broker and a family friend of the Smiths. The Smiths allowed Mark to show their house to prospective buyers but did not actually sign an agency agreement. Under this scenario, 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

An agreement to do something or to allow something to happen only after all the relevant facts are disclosed is known as...?

Informed Consent

Justin, a real estate salesperson, would like to offer his colleague a referral fee for referring him a new client. Before offering the referral fee, however, Justin obtained informed consent from the client. Why must Justin obtain consent from the client...?

Justin has a fiduciary duty to the client

Justin, a real estate salesperson with City Brokerage, received a referral fee after referring a client to Mark, another real estate salesperson with City Brokerage. Who ultimately pays Justin his referral fee...?

Justin's sponsoring Broker

A property was sold for $605,500. 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 listing broker...?

18165

A property was sold for $650,000. 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...?

19500

Amy's house was listed for $455,000. The property eventually sold for $410,000. The agreed upon commission was 5%. How much did Amy pay in commissions at the closing of the property...?

20500

Doug's house was listed for $635,000. The property eventually sold for $615,000. The agreed upon commission was 5%. How much did Doug pay in commissions at the closing of the property...?

30750

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...?

44175

According to this fiduciary duty, an agent must present all offers to the client...?

Disclosure

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

The principle which precludes a person from asserting something contrary to what is implied by a previous action or statement of that person, or by a previous pertinent judicial determination, is known as...?

Estoppel

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

Exercise reasonable care

Abby, a real estate salesperson, successfully sold her client's house. Who receives the commission from the transaction...?

Abby's Broker

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

John is a real estate salesperson for City Realty, a local brokerage company. John has been hired by Josh, a homeowner seeking to sell his house. As a sub-agent to the transaction, which of the following fiduciary duties applies to John...?

All of the above Obedience Loyalty Reasonable Care

The first contact or meeting by a licensee when some detail and information about the property is shared with parties who express some interest in the real estate transaction is known as...?

First Substantive Contact

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

General Agent

An agreement between members of a trade to exclude other members from fair participation in the trade is known as...?

Group Boycott

If two brokerage firms create an alliance in an attempt to prevent another brokerage firm from competing in the marketplace, what may the two firms be liable of...?

Group Boycotting

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

Justin, a real estate salesperson with City Brokerage, recently met a client who is looking to purchase a condo in Manhattan. Since Justin specializes in Brooklyn rentals, he decides to refer the client to a colleague of his at City Brokerage and instead receive a referral fee. If Justin's client closes a deal with the other salesperson, who ultimately pays Justin his referral fee...?

Justin's sponsoring broker

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

Landlord

In a typical agency structure, who is the primary agent to the client...?

Real Estate Broker

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...?

10249.2

Who can benefit from confidential information in a transaction...?

Client

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

The legal duty of a fiduciary to act in the best interests of the beneficiary is known as...?

Fiduciary Duty

There are generally two ways an agent is compensated for a transaction. One is a percentage of the sales price, while the other is...?

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

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

Lisa is the Agent, Robert is the Principal, and Andrew is the Customer

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

Who does the agent bring to the principal in a transaction...?

A Customer

A property was sold for $555,000. 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 buyer's broker...?

13875

A property was sold for $525,000. 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 listing broker...?

15750

What is a common breach of the fiduciary duty of accountability...?

Being negligent with the client's money

In a typical transaction, who directly pays the real estate salesperson his/her commission...?

Broker

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

Broker

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

Buyer's Agent

Cindy was a real estate salesperson in a successful transaction. Who paid Cindy her commission for the deal...?

Cindy's Broker

An agent has become aware of information that may affect the value of his client's property. If the agent reveals this information to a prospective buyer, he will be in breach of which fiduciary duty...?

Confidentiality

An agent's duty to safeguard his/her principal's lawful confidences and secrets is known as...?

Confidentiality

Which of the following is NOT considered one of the six fiduciary duties an agent owes to his/her client...?

Employee

Although an agent or principal is not obligated to disclose all information in a transaction, it is recommended that what information be revealed, in order to help the customer make an informed decision...?

Material information

Both the principal and the agent cannot do what to the customer...?

Misrepresent facts

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

Obedience

Which of the following is an example of obedience, one of the six fiduciary duties an agent owes his/her client...?

Only showing the type/size of house the client is looking for

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

Owner - Tenant

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

Seller's Agent

A real estate salesperson is typically what type of agent...?

Special Agent

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

Tenant

Chris, a real estate broker, has entered into an agreement to lease one of John's apartments. Who is the customer in the transaction...?

The Tenant

According to the duties a principal owes to the agent, the principal commits to doing which of the following...?

Compensate the agent for a successful transaction

Mark is a real estate broker who represents a buyer in a transaction. He recommended a mortgage broker to help his client obtain financing for a property. What the client doesn't know is that Mark will receive a referral fee from the mortgage broker if the client obtains a mortgage from the mortgage broker. This is a breach of which fiduciary duty...?

Accountability

One who undertakes to transact some business or to manage some affair for another by authority of the latter is known as a...?

Agent

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...?

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

Sub-agent

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

Tenant's Agent

The one by whom a broker is employed is known as a...?

Principal

A situation in which one party is held partly responsible for the unlawful actions of a third party is known as...?

Vicarious Liability

A property was sold for $625,000. The total commission for the transaction was 5%. 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 receives a 50/50 split with his broker, how much commission is paid to the real estate agent...?

7812.5

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

A property was sold for $325,000. 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...?

9750

A selling agent or participating agent is referred to as the...?

Cooperating Agent

John is a real estate broker and wants to enter into an agency relationship with Steve, a property owner. What document must John and Steve execute in order to enter into an agency relationship...?

Listing Agreement

According to which fiduciary duty is an agent prohibited from forcing on his or her client a sale, lease or opportunity to buy...?

Loyalty

A listing given to any number of brokers without liability to compensate any broker, except the one who first secures a buyer ready, willing and able to meet the terms of the listing, is known as a/an...?

Open Listing

There are generally two ways a broker is compensated for a transaction. One is a flat fee, while the other is...?

Percentage of the sale price

Many brokerages allow in-house referral fees when an agent refers a client to another agent. Who ultimately distributes the referral fee to a referring agent...?

The sponsoring broker

Mr. Smith's house was listed at $325,000. The property eventually sold for $365,000. The agreed upon commission was 5%. How much did Mr. Smith pay in commissions at the closing of the property...?

18250

A property was sold for $200,000. 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 65/35 split with his broker, how much commission is paid to the real estate agent...?

3900

A property was sold for $230,000. 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 receives a 60/40 split with his broker, how much commission is paid to the real estate agent...?

4140

If the seller or buyer agrees to dual agency before it occurs, by indicating the same on the agency disclosure form, it is referred to as...?

Advance Consent to Dual Agency

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

Confidentiality

Justin, a real estate salesperson, would like to offer his colleague a referral fee for referring him a new client. Before offering the referral fee, however, Justin obtained informed consent from the client. Justin's actions are an example of what policy...?

Full disclosure

The release of relevant information about a property that may influence the final sale, especially if it represents defects or problems is known as...?

Disclosure

Mark, a property owner, signed an agency agreement with Andrew, a real estate broker, to sell his house. What type of agency was created between Mark and Andrew...?

Expressed Agency

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

General Agent

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

An agent and the principal enter into an agency relationship through what document...?

Listing Agreement

An agent enters into an agency relationship with a prospective tenant, and in the process finds a great deal on an apartment that matches his/her client's criteria, but is also a good fit for the agent. According to the agent's fiduciary responsibilities, however, the agent is prohibited from taking the deal without first showing the deal to the client. Which fiduciary duty best describes this scenario...?

Loyalty

According to an agent's fiduciary duties, the agent must act in accordance to his/her client's demands and instructions. Which of the following fiduciary duties best reflects this...?

Obedience

The fiduciary relationship obligates the agent to act in good faith at all times, obeying the client's instructions in accordance with the contract is known as...?

Obedience

Conspiring to establish fixed fees or prices for services or products is known as...?

Price Fixing

The broker's client is also referred to as the...?

Principal

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

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

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

The conduct of a trustee, an attorney, a corporate officer, or other fiduciary that consists of taking advantage of his position in a transaction and acting for his own interests rather than for the interests of his clients is known as...?

Self Dealing

As a special agent in a transaction, a real estate salesperson is permitted to do which of the following on behalf of the client...?

Show the property

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

According to Section 442-C of the NYS Real Property Law, who may be held liable for a salesperson's actions...?

The broker

Philip is a real estate salesperson who represents a seller in a transaction. However, Philip violated several of his fiduciary duties to the client. According to the concept of vicarious liability, who can be held liable for Philip's actions...?

The broker