BUSI 443 - MC
2. Quilan McDermont has decided to do an in-house revaluation. Which of the following statements regarding in-house revaluation is FALSE? (1) Key employees may be reassigned to manage certain phases of the revaluation. (2) Appraisal staff cannot be reassigned to do data collection. (3) Statutory requirements and dates will constrain the scheduling of some tasks. (4) A full-time project coordinator should ideally be assigned to organize and manage a large scale project.
Answer: 2 Option (2) is false; Quilan should be aware that he can reassign his appraisal staff to do data collection. Options (1), (3), and (4) are true.
10. The market value of a property is $150,000, property tax is $1,200 per year, and the assessment ratio is 0.60 of the appraised value. What is the effective tax rate? (1) 0.48 percent (2) 0.80 percent (3) 1.33 percent (4) Cannot be determined with the information provided.
Answer: 2 The effective tax rate is based on the market value of the property: Effective Tax Rate = 1,200 150,000 = 0.008 OR 0.80 percent The nominal tax rate is based on the taxable value of the property: Nominal Tax Rate = 1,200 (150,000 0.6) = 0.0133.
1. Batch data management programs process information in a series of steps. Some of the steps that a batch data management program processes through are listed below. A. An update program processes the transactions against the master file. B. Information is sorted into the same sequence as the file being updated. C. Valid transactions are passed to the master file. D. An audit trail is produced. E. The transactions may be processed through an edit routine for validity. Place the above list of steps in the order in which they occur. The correct order is: (1) D, A, B, C, and E. (2) B, A, E, C, and D. (3) A, B, C, D, and E. (4) B, E, C, A, and D.
Answer: 4 Option (4) is the correct sequence of steps through which batch data management programs process information.
5. Which of the following statements is FALSE? (1) A laser printer is an input device. (2) A digital camera is a computer peripheral. (3) An ink-jet printer is an output device. (4) A Gigabyte is 1,024 times larger than a Megabyte.
Answer: 1 Only option (1) is false. A laser printer is an output device.
10. Regarding the registry system, which of the following statements is FALSE? (1) It assures that the status of the title is guaranteed once the property is entered into the registry system. (2) It is a method of orderly registration of different and potentially competing interests in property. (3) It provides for statutory rules which amend the common law principles regarding the priority of various interests. (4) It is a public recording of instruments affecting land.
Answer: 1 Option (1) is false. The registry system is a record of instruments affecting land, but it does not assure that the status of the title is guaranteed.
10. A control form is designed to provide control and summary information to the assessment office. Which of the following options is NOT information that would be included on a control form? (1) The number of parcels, including a breakdown by property type. (2) An accurate depiction of the parcel density factor, complexity factor, and callback factor. (3) A list of dates corresponding to certain activities which were completed by various personnel. (4) A list of parcels still requiring work.
Answer: 2 The parcel density factor, complexity factor, and callback factor should not be included on a control form; these factors are instead used to calculate production rates. A control form could include identification number of units, field and office functions, commercial cards, incomplete fields, market data, and cards temporarily pulled
3. Matthew Cognax has put out a request for proposals. He is worried that the bid will be evaluated solely on the basis of cost rather than on the quality of vendor. Matthew wishes to avoid this problem. Which action(s) could Matthew take in order to ensure that the bid decision is not based solely on the price? (1) Matthew can have potential contractors attend a conference where the technical requirements are explained by the assessment staff. (2) Matthew can begin by obtaining only technical proposals from potential contractors that do not include prices. (3) Both Options (1) and (2). (4) None of the above.
Answer: 3 Both Options (1) and (2) will help to ensure that the winning bid is based on quality and not just low cost.
3. In a network structure, the data are organized in: (1) a logical hierarchy. (2) a set of related tables. (3) a "schema" maintained through indexes and pointers. (4) a linked list.
Answer: 3 In a network structure, the data are organized in a "schema" maintained through indexes and pointers. A logical hierarchy is a tree structure. A set of related tables is a relational structure. A linked list is not a DBMS structure.
6. In general, which statement regarding data management is FALSE? (1) Parcel identification numbers should incorporate the map identification number for each property on the assessment roll. (2) Batches of source documents can be tracked from one phase of the operation to the next. (3) Key verification and manual editing are always necessary to maintain consistency and accuracy. (4) A master edit program for batch data management is necessary.
Answer: 3 Option (3) is false because key verification and manual editing are only sometimes necessary, especially if data entry is being done in a batch mode. When data is entered in batch mode, the data is not immediately processed, so key verification can reduce errors in the data.
4. A relational database structure offers the advantage that: (1) they appear as flat files and are less complex than other structures to establish and maintain. (2) they usually offer greater processing flexibility. (3) records can be selected, combined, and processed in a variety of ways based on their relationships. (4) all of the statements above outline benefits of a relational database structure.
Answer: 4 All of the options outline advantages of a relational database structure.
8. In addition to the swimming pool, a pool house was built to serve as guest accommodation for Susan's friends who over-indulge at her parties. The pool house has stucco walls. How would an appraiser categorize the wall type of Susan's pool house? (1) Quantitative, binary, and subjective (2) Qualitative, continuous, and subjective (3) Quantitative, discrete, and subjective (4) Qualitative, discrete, and objective
Answer: 4 The wall type involves a qualitative description, such as "wood framing with stucco finish". The wall type is a discrete variable because there are few wall types. Finally, the wall type is an objective characteristic as is can be directly observed.
4. Identify the three primary assessment responsibilities in accordance with property tax policy in a real estate assessment system. (1) Supervision, Valuation, Appeal (2) Categorization, Taxation, Listing (3) Equalization, Valuation, Review (4) Discovery, Listing, Valuation
Answer: 4 discovery, data gathering, valuation, listing and assessment
8. What are the three main functions of the CPU? (1) Arithmetic/logic, cause information to be moved or processed, and control. (2) Memory, control, and printing. (3) Processing, arithmetic/logic, and printing. (4) Memory, arithmetic/logic, and cause information to be moved or processed.
Answer: 1 The Central Processing Unit is the "brain" of the computer and has three specialized functions: arithmetic/logic, cause information to be moved or processed, and control.
4. Kosmo needs to formulate a mission statement that summarizes the goals and objectives of the company. (1) Strategic planning (2) Operational planning (3) Project planning (4) None of the above
Answer: 1 A mission statement summarizes the general goals and objectives of an organization. Formulating a mission statement is a part of the strategic planning process.
The next TWO (2) questions are based on the following information: The two statements below describe an aspect of either single-property appraisal, mass appraisal, neither, or both. Use the following statements to answer the next TWO (2) questions. A. The output is an appraisal report with one statement of value B. Statistical methods are relied on for quality control. 4. Statement A most accurately describes a component of: (1) single-property appraisal (2) mass appraisal (3) both single-property appraisal and mass appraisal. (4) None of the above.
Answer: 1 A single-property appraisal has one appraisal report with one statement of value, whereas a mass appraisal's output will have several statements of value for various properties.
8. An effective assessment system requires a strong legal framework that does NOT include which of the following features? (1) Establish a framework of appraisal techniques to estimate the value of a taxable property. (2) Establish effective assessment notification, review, and appeal. (3) Mandate the disclosure to assessors of such market data as sales prices and terms, rents, and operating expenses. (4) Require public notice of, and controls on, increases in tax levies made possible by reappraisals.
Answer: 1 All statements are a feature of the legal framework of an effective assessment system except for Option (1). A framework of appraisal techniques to estimate value is one of the primary tasks performed by assessors working toward completion of an assessment roll.
The next THREE (3) questions are based on the following information: A Database Management System (DBMS) provides many advantages over simple flat file structures. Database structures take several basic forms: tree, network, and relational. Each of these forms has specific characteristics. 2. In a tree structure, the data are organized in: (1) a logical hierarchy. (2) a set of related tables. (3) a "schema" maintained through indexes and pointers. (4) a linked list.
Answer: 1 In a tree structure, the data are organized in a logical hierarchy. A set of related tables is a relational structure. A "schema" maintained through indexes and pointers is a network structure. A linked list is not a DBMS structure.
9. Adjustments for financing are needed when: (1) the vendor provides beneficial financing. (2) the purchaser assumes an existing mortgage at the current interest rate. (3) the vendor pays delinquent taxes. (4) Both (1) and (3).
Answer: 1 No adjustment is needed if (2) the assumed mortgage is at the current rate of interest or if (3) the vendor pays the delinquent taxes. Adjustments for financing are needed when the vendor provides beneficial financing.
10. An appraisal office, managed by a super manager named Klark Hent, is in charge of the entire bustling region of Metropolis. The appraisers of this office value a wide range of property including commercial, residential, industrial, and mixed-use properties. Since there are so many different property types in this jurisdiction, Klark wishes to match each appraiser's skills with property type. Klark prefers to give his employees autonomy. Which type of organizational structure is best suited for this appraisal office? (1) A wide span of control, with a functional or geographical organizational structure where the organization is divided into departments by property type. (2) A wide span of control with a jurisdictional organizational structure. (3) A narrow span of control with a functional organizational structure. (4) A narrow span of control with a matrix organizational structure.
Answer: 1 Option (1) describes an organizational structure that is best suited for this example. A wide span of control is suitable for employees with a fair amount of autonomy, doing high level appraisal tasks, and the valuation of complex properties. A large jurisdiction such as in this example can be divided by functional or geographical organization. Ideally, it should be divided into departments that specialize in the different property types, which can then be further divided by function or by geographical region.
8. Bonnie describes her property in the following manner: She lives in a rustic cottage, high in the land of the green rolling hills. Her property is bounded on the east by the highest hill in the region, from which she performs her morning yodel. A babbling brook bounds her property to the west and provides clean drinking water. A neighbouring sheep farm borders the north of her property, and a valley of lemon trees bounds the south of the property. Which type of land description or land referencing system is she using? (1) The "bounded" description. (2) The rural and agricultural system. (3) The section and township system. (4) The lot and block survey system
Answer: 1 The "metes and bounds" system is the earliest form of land description which describes the property by referencing the physical features by which the property is "bound".
4. Mary was considering the purchase of a small office building in which to carry on her accounting business. She was concerned about expected increases in property taxes and approached the assessor for assistance. The assessor informed Mary that "the expected increase in taxes is about 15 percent". Behind the counter was a notice stating, in part: "The employees of this office cannot provide accurate information about expected property taxes. Any taxpayer who relies on such advice does so at their own risk." Mary purchased the office building and six months later received a tax bill that was double the previous year's bill. The assessor was unaware that the municipality had intended to shift the tax load to business property. Mary is forced to relocate. Given the above scenario, pick out the statement which is TRUE concerning Mary's legal position. (1) Mary may have a claim in negligent misrepresentation against the assessment authority. (2) Mary may have a claim in negligent misrepresentation against only the assessor. (3) Mary will be unlikely to succeed in a claim in negligent misrepresentation because the assessment office has a disclaimer notice. (4) None of the above.
Answer: 1 Option (1) is correct: Mary can initiate an action against the employer based on vicarious liability. Option (2) is false because legally Mary can take action against the employer as well. Option (3) is false because the disclaimer was not properly brought to Mary's attention. As well, because the disclaimer was behind the counter it is unlikely that it was properly displayed for Mary to see. Four elements must be present to initiate an action of negligent misrepresentation against the assessor and the assessor's employer: • apparent knowledge — it is reasonable to assume the assessor would be knowledgeable about property taxes; • wrong advice — the assessor was wrong about the increase in taxes; • reliance — Mary relied on the assessor's advice and assumed she would be able to afford the property taxes if she purchased the property; • damage — Mary had to relocate her business, at some cost and inconvenience, because of the unexpected property tax bill; The disclaimer will not protect the assessor because it was not brought to Mary's attention. Furthermore, the assessor made no effort to ensure the information was correct. He or she was relying on past increases in taxes and could have easily phoned the municipality to check.
9. A parcel of land within a given block has been split. However, under this parcel identification system, the parcel's split is not recognizable from its identifiers. In which of the following is the parcel identification system in use? (1) Geographic coordinate (geocode) parcel system (2) Consolidation coordinate parcel system (3) Computerized mapping system (4) Geographic parcel split system
Answer: 1 Option (1) is the correct answer. In the geographic coordinate (geocode) system, parcel splits are identified by their coordinates, so it is not possible to identify a split from the geocode. If two parcels are created from one larger parcel, the two "new" parcels simply take on the new geographic coordinates. Consolidations use the coordinates of the newly combined parcel which may or may not be the same geocode as one of the older parcels.
5. Which of the following is NOT generally considered to be a regressive tax? (1) Pure income tax. (2) The Goods and Services Tax. (3) A poll tax. (4) A tax that represents a larger proportion of income for those who earn a lower income compared to those who earn a higher income.
Answer: 1 Option (1) is the correct answer. The pure income tax is a progressive tax because tax rates increase as income increases. Option (2), the Goods and Services Tax (GST), is a sales tax in Canada. Sales taxes in general are often argued to be regressive because those with lower incomes spend a larger proportion of their income on consumption. Option (3), a poll tax, is not based on income, but rather a charge on everyone (i.e., the poorer you are, the bigger proportion of your income is going to the tax, compared to a rich person). Option (4) is the definition of a regressive tax.
7. Maria Olet has chosen a vendor for a CAMA system "CAMA Sutra", and is currently writing up the contract. Which of the following statements regarding contracts is TRUE? (1) If the contract is cancelled by the jurisdiction, then the jurisdiction would usually pay the vendor for reasonable closedown costs. (2) A 100 percent performance bond will not help to ensure that a project is completed. (3) Payment schedules should not be included in the contract, rather the total amount of the contract should be included. (4) A contract cannot be cancelled even if key deliverables, on which the contract depends, are not available.
Answer: 1 Option (1) is true. Option (2) is false because a 100 percent performance bond should help to ensure that the project is completed. Option (3) is false as payment schedules should be included in the contract. Option (4) is false because a contract can be cancelled if key deliverables are not available.
4. Which statement regarding revaluation is TRUE? (1) Revaluation can create tax shifts that may have negative political repercussions. (2) Appraisal inequities do not cause significant problems, because, overall, the city will collect the same amount of taxes. (3) Overappraisal creates a lower tax base which causes the community to set higher tax rates. (4) A full revaluation involves the collection and verification of property characteristics and the estimation of new value for only a single property.
Answer: 1 Option (2) is false. Appraisal inequities can cause harm to the community as dissatisfied taxpayers will seek review, and these reviews cost general taxpayers money. Option (3) is false because underappraisal, not overappraisal, creates a lower tax base that causes the community to set higher tax rates. Option (4) is incorrect because a full revaluation involves the collection and verification of property characteristics and the estimation of new value for multiple properties.
1. Which of the following statements concerning GPS is FALSE? (1) Signals from a minimum of six positioning satellites are required for a GPS receiver to establish its position. (2) GPS is useful in map-making. (3) GIS is a substitute for GPS, in areas where satellite coverage is insufficient. (4) As of 2009, the best GPS technology can provide locations within centimetres of its actual location.
Answer: 1 Signals from a minimum of THREE positioning satellites are required for a GOPS receiver to establish its position.
3. Which of the following statements is FALSE regarding sales screening? (1) All single parcel sales should be included in your sales analysis. (2) Multiple-parcel sales must be adjusted, if necessary, for plottage value. (3) Houses expropriated for the building of a highway should likely not be included in your sales analysis. (4) Partial interest sales and trades require careful analysis before they can be included in your sales analysis.
Answer: 1 Single parcel sales should only be included if they appear to be arm's length and representative of market value. The rest of the statements are true.
5. Judge Cindy Hirotucka is making a ruling which falls under the "Assessment Act" in her province. In order for Judge Hirotucka to correctly interpret certain words in the Act, she could consider and take into account: A. Black's Law Dictionary's definitions of certain words. B. the grammatical and ordinary sense of the words. C. that the title and preamble are not a part of the statute that will aid Judge Hirotucka. D. that general words are not restricted to the same class as the specific words which precede them. (1) Both A and B (2) Only B (3) Both B and D (4) Both C and D
Answer: 1 Statement A is true, as Black's Law Dictionary can be a useful tool to a Judge interpreting a particular word in a statute. Statement B is true. Statement C is false because title and preamble are part of the statute. Statement D is false as words ARE restricted to the same class as the specific words which precede them.
The next THREE (3) questions are based on the following information: Kosmo is a high energy, though slightly disorganized, manager of an assessment office. He has many duties to coordinate and incorporate into his planning process. These duties may be categorized into his strategic planning, operational planning, project planning, or into another planning process. In the following questions, choose the planning process that each duty is best allocated to. 3. Kosmo needs to do a situation analysis to study factual matters such as legislation and economic and social trends. He will also examine the values of the individual employees and how they align with company values. (1) Strategic planning (2) Operational planning (3) Project planning (4) None of the above
Answer: 1 The duties of strategic planning include conducting a situation analysis or environmental scan that studies factual matters such as legislation, existing work loads, economic and social trends, current capabilities, and the values of individuals and institutions.
9. Imagine a system of taxation where commercial and industrial properties are subject to a higher tax rate than residential properties. As owners of residential properties make up the majority of taxpayers, they will tend to demand a greater level of services because the bulk of the cost would be borne by commercial and industrial taxpayers. Since commercial and industrial properties typically have customers from outside the city, the increased tax burden here would be exported to these external customers rather than the taxes being borne by those receiving the services within the city. The above scenario violates: (1) The accountability principle because tax is being exported. (2) The fairness principle because residential property owners should make up the bulk of tax revenues, rather than commercial and industrial taxpayers. (3) The neutrality principle because industrial taxpayers will avoid the tax. (4) None of the above.
Answer: 1 The scenario violates the accountability principle, which says that tax burdens should not be exported.
1. In order to make residents pay for local services, Jordan Candell, the Mayor of Ottawa, is considering implementing a fixed annual tax which will be levied on individuals living within the local area. In general, this type of tax will likely be problematic for all of the reasons below, EXCEPT: (1) There will be a greater difficulty in determining land values. (2) People will likely evade the tax. (3) The registration process will create significant costs. (4) It is a regressive tax.
Answer: 1 The tax proposed by the Mayor is similar to a poll tax. Option (1) is the correct answer, as difficulty in valuing land is associated with a land value tax, not a poll tax. A poll tax is a regressive tax that creates evasion and enforcement difficulties. Because people are mobile, it is usually difficult and expensive to register people for the tax
4. Hoopla Merryweather is the manager in a large and bustling assessment office. In the next 20 weeks, Hoopla must collect data on 35,000 residential parcels. Due to flex days, his staff works only 4 days per week. Hoopla's office has an effective production rate of 6 parcels per day. What is the approximate number of data collectors required? Also, if Hoopla wants one supervisor for every four workers, approximately how many supervisors does Hoopla require? (1) 73 data collectors and 18 supervisors (2) 39 data collectors and 10 supervisors (3) 59 data collectors and 15 supervisors (4) 68 data collectors and 17 supervisors
Answer: 1 Working days = 20 weeks 4 days per week = 80 Data collectors required = 35,000 (80 × 6) = 72.9 Supervisors required = 72.9 4 = 18 supervisors
5. Kosmo needs to specify measures of performance and prepare the groundwork for the budget including itemizing the resources required. (1) Strategic planning (2) Operational planning (3) Project planning (4) None of the above
Answer: 2 An operational plan supports the strategic plan and serves as the basis of a budget request. An operational plan provides information about how resources will be allocated to meet specific objectives, and provides measures to evaluate performance.
9. An effective assessment system includes features for effective internal controls within the assessment process. These internal control features include which one of the following? (1) Complete maps and property data that are updated regularly to show changes in parcel boundaries or other physical characteristics. (2) Standards of practice manuals to establish work procedures and policies. These may incorporate laws, regulations, and policy memoranda. (3) Accurate market data records that contain complete and accurate information about the sales prices and conditions of properties sold within a jurisdiction. (4) An active public relations program that includes talking to the public and the news media, and providing printed information and correspondence.
Answer: 2 Complete maps and property data, periodic ratio studies, and accurate market data are features of an effective assessment system, not of effective internal controls.
5. Statement B most accurately describes a component of: (1) single-property appraisal (2) mass appraisal (3) both single-property appraisal and mass appraisal. (4) None of the above.
Answer: 2 Mass appraisal uses statistical methods for gauging accuracy and consistency of valuations.
7. Choose the option that categorizes this following statement on motivation: The need for self- actualization, achievement, and self-esteem motivate people to work. (1) Theory X (2) Theory Y (3) Theory Z (4) The statement does not reflect a specific motivational theory.
Answer: 2 Modern motivational theory, Theory Y, assumes that motivation to work results from high-level needs of self-actualization, achievement, and self-esteem, not only the need for security.
9. In certain situations, appraisers may account for the effect that restrictions on use have on a property's market value, while in other situations they must ignore these restrictions on use. In which one of the following situations would the appraiser take the restriction on use into consideration? [In answering this, assume the Consolidated Shelter decision offers the legal precedent to follow] (1) An agreement between the owner and the Canada Mortgage and Housing Corporation to restrict rents in return for a favourable mortgage rate. (2) A registered easement with the municipality allowing access along the driveway of the property. (3) A registered lease between the owner and a tenant who is occupying a workshop on the property. (4) The appraiser would ignore restrictions on use in all of the situations above.
Answer: 2 Option (1) and (3) should be ignored because the municipality was not a party to these agreements and therefore should not be expected to lower property taxes as a result of them. Option (2) should be taken into consideration because the municipality was a party to the agreement and should therefore consider the restricted use of the property tax payable.
1. Regarding data verification and data collection, which of the following statements is TRUE? (1) If the tax rate is fairly low, the community will require a high level of accuracy on the valuations. (2) If permission to inspect the property is refused, then the appraiser can still estimate the property's value. (3) Self-reporting should not be used because people will falsify the value of their house in order to avoid property taxes. (4) Review by exception means that appraisers are required to review all properties in the field without any exceptions.
Answer: 2 Option (1) is false because if the tax rate is HIGH, the community will require a high level of accuracy on the valuations. Option (3) is false because self-reporting can be used to detail and describe improvements made on the property. Option (4) is false because review by exception refers to the process by which only properties that fail certain data checks will be field reviewed. Option (2) is true: if permission to inspect the property is refused, then the appraiser can still estimate the property's value, but the taxpayer may lose the right to appeal the valuation.
7. Which of the following statements is TRUE regarding appraised value and assessed value? (1) The assessed value is always less than the sales ratio for each property. (2) The appraised value of a property is determined according to the judgement of an appraiser on a specific appraisal date. (3) Under the ad valorem taxation system, the assessed value of the property is always a fraction of appraised market value of the property. (4) Legislative policy determines the appraised market value of a property.
Answer: 2 Option (1) is false — the sales ratio is a ratio of appraised/assessed value to market value. It will typically be expressed as a percent, e.g., 90% or 115%; this number will be much smaller than the assessed value. Option (3) is false because the assessed value of the property may either be a fraction of the full appraised market value or it may be the full market value. Option (4) is false because legislative policy does not determine market value -- legislation can set assessment ratios and define what is to be assessed, but it is the appraisal process that determines market value. Option (2) is true.
1. Regarding the valuation of property, which of the following statements is FALSE? (1) It is inappropriate for the appraiser to add special value to a particular owner. A family who pays a premium for a property formerly in the family contains a special value which should not be included. (2) An appraiser may value the land according to its highest and best use and then value the improvements on some other basis, even if total value exceeds the highest and best use value as improved. (3) The appraiser has a responsibility to value all of the different interests in a property. (4) The appraiser is required to ignore the effect of any restrictions on use that have been placed there by the owner.
Answer: 2 Option (2) is a false statement because according to Toronto v. Ontario Jockey Club an assessor may NOT value the land according to its highest a best use and then value the improvements on some other basis.
2. The functions an assessor performs can be broadly classified as either judicial (including quasi-judicial) or administrative. Identify which of the following functions is administrative. (1) An assessor determines that a certain piece of equipment qualifies for an exemption from taxation because it is used to abate pollution. (2) The assessor alters the assessment notice to enhance taxpayer understanding. (3) The assessor appeals an assessment because of incorrect inventory: the original assessment was based on land only, but a building has been constructed and now occupies the site. (4) None of the above.
Answer: 2 Option (2) is administrative because it involves discretion, but does not affect the rights or obligations of the taxpayers. Option (1) is judicial because it affects the taxes paid and involves discretion. Option (3) is judicial because a decision to bring an error or omission forward to the appropriate court of review involves discretion and affects the taxes paid by the property owner.
6. Robert is in the initial stages of selecting a CAMA system for his assessment office. He knows that this will be a major decision with long-term implications for cost and performance. He is considering the use of public domain software because it can be implemented quickly and will cost very little. What else should he consider? (1) Public domain software is hard-coded, but easy to modify. (2) In-house development will take longer and cost more, but is fully customized. (3) Public domain software is always well-documented. (4) Purchase of a commercial system cannot be adapted to his legislative requirements.
Answer: 2 Option (2) is correct. In-house development will take longer and cost more, but is fully customized. Public domain software is hard-coded, but it is difficult to modify, and is often not well-documented. Purchase of a commercial system can usually be adapted to the legislative requirements of the jurisdiction.
7. User training, system maintenance, and program modifications necessitated by changes in user requirements should be provided for under a Request For Proposal (RFP). This is part of the issue called: (1) expandability. (2) system documentation and support. (3) transferability. (4) security and backup.
Answer: 2 Option (2) is correct. User training, system maintenance, and program modifications necessitated by changes in user requirements should be provided for under a Request For Proposal (RFP). This is part of the selecting a CAMA system issue called system documentation and support. Expandability is the issue concerning the ease with which the system can be upgraded to support increased use or new technology. Transferability is the ability to exchange data with other computer systems. Security and backup is the issue of data integrity and protection from inadvertent or malicious damage.
1. Karen is shopping for hardware to support her new CAMA system. She realizes that she has four options: outright purchasing, leasing, using a service bureau, and sharing of facilities. Which of the following is NOT a correct consideration to take into account before she decides? (1) For low-volume use, service bureaus are efficient. (2) Leasing will provide her with a fixed cost solution. (3) Purchasing will give her a modest annual cost, but a large initial cost. (4) Maintenance and modification using shared facilities may be difficult.
Answer: 2 Option (2) is incorrect: leasing will not provide her with a fixed cost solution. The other statements are all correct.
6. Ronaldo, a Brazilian coconut farmer, sells one of his properties to Oliver, a Porsche factory worker from southern Germany. Oliver will pay the $1.85 million in monthly installments over the period of four years. The balance will be due upon maturity. Once the payments are complete, Ronaldo will deliver legal title of the property through a deed. This above scenario describes which of the following options? (1) Unrecorded conveyance (2) Quitclaim deed (3) Contract for deed (4) Warranty deed
Answer: 3 A contract for deed involves an agreement for sale between the vendor and the purchaser. The vendor delivers legal title in the property through a deed once the purchaser completes the required payments.
10. Which of the following describes a problem in aerial photography due to relief displacement? (1) Images are displaced with respect to the point directly below the camera; objects above the elevation of this point are displaced radially inward. (2) Objects at higher elevations appear larger. (3) Large objects are closer than they appear. (4) All of the above.
Answer: 2 Relief Displacement describes a problem in aerial photography where the photo image is distorted because the ground is not perfectly level. Objects closer to the camera appear larger; objects further away appear smaller. Objects are also distorted with respect to the point directly below the camera. Option (1) is incorrect because objects above the point directly below the camera are displaced radially outward. Option (2) is correct.
6. The definition of the "Old View" perspective regarding the regressiveness and progressiveness of taxes, holds all of the following EXCEPT: (1) Tax on structures can be shifted to consumers. (2) Property taxes are imposed at a uniform rate across the country. (3) Property tax that falls on land must be borne by landowners. (4) Land is assumed to be fixed in supply.
Answer: 2 The "Old View" regarding the regressiveness and progressiveness of tax divides property tax into two categories: land and improvements (structures). Because structures are investment decisions, the property tax that falls on the structure can be shifted to the price of the consumer goods and services that are provided by the structures. Assuming that land is fixed in supply, property taxes that fall on land must be borne by landowners, because they cannot alter the quantity of land supplied and thus pass the tax onto consumers. Option (2) is an assumption of the "New View" of property tax incidence.
6. An appraiser has just finished an appraisal and is about to perform the reconciliation of values, model testing, and quality control. Which of the following statements concerning the reconciliation is FALSE? (1) The appraiser will review the data developed and used. (2) The appraiser will check the work performed in each of the three approaches. (3) The appraiser will consider the quality and quantity of data. (4) The appraiser will consider the relative strengths and weaknesses of each approach for valuation of the type of property.
Answer: 2 The appraiser should check the work performed in each of the three approaches before performing a final reconciliation; this check should be done as part of each approach, until the appraiser is sure that everything reported within that particular approach is as correct as it can be.
7. Susan Gunderson is a well known socialite in Scarborough. Susan intends to have lavish parties, so she recently had very expensive landscaping carried out in her backyard. To categorize this high quality landscaping as a variable, an appraiser can utilize three dimensions: quantitative or qualitative; continuous, discrete, or binary; and objective or subjective. Which of the following is the best categorization of the quality of Susan's landscaping? (1) Quantitative, discrete, and objective (2) Qualitative, discrete, and subjective (3) Quantitative, continuous, and subjective (4) Qualitative, binary, and subjective
Answer: 2 The appraiser will categorize the quality of landscaping to be qualitative. This particular qualitative measure would be subjective because it is based on the appraiser's opinion and judgment. The quality of landscaping is most likely discrete because it is not measured (i.e., as in number of feet), but would more likely have to be coded using numerical values, e.g., excellent = 5, good = 4, average = 3, etc.
9. Overall, Susan has developed a fantastic and extravagant backyard, including a pool house and a swimming pool in the shape of a swan. How would an appraiser categorize the overall architectural style of both the swimming pool and the pool house? (1) Quantitative, continuous, and objective (2) Qualitative, discrete, and subjective (3) Qualitative, binary, and subjective (4) Quantitative, binary, and objective
Answer: 2 The architectural style of both the swimming pool and the pool house is a qualitative description because it is based on the appraiser's subjective opinion on its attractiveness to the market. The architectural style is a discrete variable because a rating scheme can be used to express the quality of the design.
4. Emma requires a computer mapping system. She needs one which permits the mapping of cartographic features, as well as the use of overlapping map layers that each contain specific information. She will need a database system which can store and manipulate the information that she gathers, but she will not be performing in-depth analysis between the different mapping layers. Which of the following options would best suit her needs? (1) Computer-assisted drafting (CAD) systems (2) Automated mapping/facilities management (AM/FM) systems (3) Coordinate geometry (4) Geographic information systems.
Answer: 2 The automated mapping/facilities management (AM/FM) system features sophisticated databases capable of storing and manipulating related attribute information. It is limited in its ability to analyze relationships between different mapping layers other than through visual inspection of the overlapping layers.
1. Mac Donald, an appraiser, has created a mass appraisal model to estimate values of residential properties in a neighbourhood of new and fairly similar residences. He is now carrying out his model testing and quality control. He is using the coefficient of dispersion, with respect to the median ratio, to measure uniformity. He is aiming for a target coefficient of dispersion of 20 percent. Which of the following statements is TRUE? (1) Mac's calculation of uniformity is correct because in areas of newer and fairly similar residences, the coefficient of dispersion should be 20 percent or less. (2) Mac's calculation of uniformity is incorrect because for newer and fairly similar residential properties, the coefficient of dispersion should be 10 percent or less. (3) Mac's calculation of uniformity is correct because in urban areas, income-producing properties require a coefficient of dispersion of 20 percent, and these are income-producing properties. (4) Coefficient of dispersion is not a measure of uniformity.
Answer: 2 For residential properties, uniformity, as measured by the coefficient of dispersion, with respect to the median ratio, should be 15 percent or less generally, and 10 percent or less in areas of newer and fairly similar residences. Mac is correct to use the coefficient of dispersion to measure uniformity, but his target should be 10 percent or less.
2. Jim Duncan has a cabin in the woods that he wants to rent out in order to make some extra income. He estimates that the cabin will provide a perpetual income of $15,000 per year. The rate of return on similar investments of similar risk is 12 percent. Using this information, Jim calculates the value of the property to be: (1) $128,000 (2) $140,000 (3) $125,000 (4) $124,500
Answer: 3 Using the capitalization formula, we can calculate the value of a property that provides a perpetual income, using a given rate of return for investments that have a similar level of risk. The formula is V = I R.
9. Eliza Vera is now considering which valuation approach she should take on a certain property. There is a single two-storey building on the property, with the Kwikee Convenience Store on the first floor and a family renting the upstairs portion. Assume that the building is in its highest and best use. Which approach would most likely be ideal for valuing this unique property? (1) The cost approach (2) The direct comparison approach. (3) The income approach. (4) The residual approach.
Answer: 3 Eliza would likely use the income approach to value this property. For commercial properties, the income approach is usually most appropriate, since you will be determining the value of an income stream. The sales comparison approach would be inappropriate as the property is unique and unlikely to have sales comparables.
8. Eliza Vera is in charge of a revaluation project in Wichtuck, a small town of 3,000 people. The town conducts a revaluation every few years. Eliza has a fast-approaching deadline and a very small staff who are always very busy. In preparation for this project, Eliza will most likely do which of the following? A. Create a budget. B. Install a CAMA system. C. Hire additional staff. D. Clearly define her goals. (1) A, B, and D (2) B and C (3) A, C, and D (4) All of the above.
Answer: 3 Eliza would most likely create a budget and clearly define her goals for the project. Because Eliza is in a small town and because she has a fast-approaching deadline, she would also most likely hire additional staff. Eliza would not likely install a CAMA system, as it would be hard to justify a large and costly system for such a small jurisdiction and relatively small project.
3. When performing a city and regional analysis, an appraiser must consider many economic forces that affect property values through both the demand and supply sides of the market. Which of the following is NOT a factor that affects the supply side of the market? (1) Availability of vacant land (2) Construction trends and costs (3) General trends in real property prices and rents (4) Building codes
Answer: 3 General trends in real property prices and rents are macroeconomic factors affecting the demand side of the market, not the supply side.
1. Which of the following describes a problem in aerial photography due to relief displacement? (1) Images are displaced with respect to the point directly below the camera; objects above the elevation of this point are displaced radially inward. (2) Objects at higher elevations appear larger. (3) Large objects are closer than they appear. (4) All of the above.
Answer: 3 Line item budgeting is characterized by classifications of spending into object classes. It displays the breakdown of spending and is designed to achieve financial control and minimize opportunities for corruption by controlling spending.
5. A questionnaire is to be mailed requesting income and expense data for assessment purposes. Which of the following statements are TRUE? A. Questionnaires are an expensive way to collect income and expense data. B. Questionnaires should be accompanied by a cover letter that states the purpose and importance of the information. C. Questionnaires can be effective following a sale or a newly negotiated lease. D. Questionnaires must be uniform across all income-generating property types. (1) Only A, B, and C are true. (2) Only A and D are true. (3) Only B and C are true. (4) All of the statements are true.
Answer: 3 Mailed out questionnaires are an inexpensive method of collecting income and expense data (although the response rate can be low), thus statement A is false. Questionnaires should have differences based on the type of property such as apartment buildings or hotels; statement D is false. Statements B and C are true.
2. According to the Classical school approach, the responsibilities of management include duties that are best described by which of the following options? (1) A manager should create an open organizational system whereby each of the four subsystems is harmoniously interrelated. (2) A manager is responsible for conducting organizational research and matching individual employee goals with organizational objectives. (3) A manager is in charge of five key functions including planning, organizing, directing, coordinating, and controlling. (4) A manager is in charge of five key functions including organizing, hiring, research of group dynamics, budgeting, and reporting.
Answer: 3 Option (1) describes responsibilities of management according to the Systems school. Option (2) describes responsibilities of management according to the Neoclassical school. Option (4) is incorrect because research of group dynamics is not considered by the Classical school as a responsibility of management.
2. Two effects of site value taxation are the liquidity effect and the incentive effect. Which statement below is FALSE? (1) Liquidity effect: land tax increases holding costs. (2) Incentive effect: the supply curve for improvements shifts to the right. (3) Incentive effect: tax on land will affect the quantity of land supplied. (4) Both the incentive and liquidity effect will reduce urban sprawl.
Answer: 3 Option (3) is a false statement because with the incentive effect a tax on land will NOT affect the quantity of land supplied. This is due to the fact that the supply of land is fixed or inelastic.
3. Mr. Yon has sold his house and is currently moving out. As he is packing, Mr. Yon comes across his 10' × 14' metal tool shed in his yard, which is not affixed and simply sits by its own weight on the ground. Mr. Yon personally purchased this tool shed many years ago and wants to know if he can disassemble it and bring it to his new yard. What is the best advice you could offer Mr. Yon? (1) Mr. Yon should leave the tool shed because it is a structure and cannot be removed from the premises. (2) Mr. Yon should leave the tool shed because the purpose of the tool shed is for the enhancement of the premises. (3) Mr. Yon should take the tool shed because the shed is attached to the land only by its own weight. (4) Mr. Yon should take the tool shed because he bought it personally.
Answer: 3 Option (3) is correct because the tool shed is only connected to the land by its own weight and therefore is considered a chattel. Option (1) is incorrect, as it does not matter if the tool shed is a structure, it can still be considered a chattel as long as it is not affixed to the ground. Option (2) is incorrect: if an item fails the first part of the two part test (degree of affixation), then the second part of the test is inconsequential. Because it has already been determined that the tool shed is not affixed to the land, the purpose of affixation has no bearing. Option (4) is incorrect because it does not matter who originally purchased the tool shed.
9. Which of the following is NOT a step in performing single-property appraisal using the direct comparison approach? (1) Discover and analyze the data. (2) Determine the units of comparison and determinants of value. (3) Analyze the adjusted comparables to arrive at adjusted sales prices for the comparable properties. (4) Compute value by capitalization
Answer: 4 Computing the value by capitalization is used in the income approach
7. Regarding the functions performed by assessors, which statement is TRUE? (1) The use of the word "may" in a statute indicates an absolute discretion to determine the matter as the decision-maker sees fit. (2) Whether or not property is assessable can be decided irrevocably by the assessor. (3) Errors and omissions must be brought forward for correction. (4) All of the above.
Answer: 3 Option (3) is correct; the assessor has a duty to bring all errors and omissions forward. Option (1) is false, because the use of the word "may" in a statute does not indicate an absolute discretion to determine the matter as the decision-maker sees fit. Option (2) is false, because whether or not the property is assessable can be decided irrevocably by the courts not the assessor.
7. One of the basic functions of a mass appraisal system is revaluation. Required activities of revaluation include: performance analysis, revaluation decision, and so on. With regards to these activities, which statement is FALSE? (1) System development occurs before the pilot study (2) The appraiser conducts a final ratio study to measure accuracy and uniformity. (3) A jurisdiction should first define its goals before taking stock of its resources. (4) A performance analysis determines whether values are equitable and consistent with the market.
Answer: 3 Option (3) is false because a jurisdiction should take stock of its resources, before it sets goals; thus enabling the jurisdiction to set realistic goals. Option (1) is true, as system development occurs before a pilot study. Option (2) is true because an assessor conducts a final ratio study to measure accuracy and uniformity in the final performance analysis. Option (4) is also true.
8. After much hard work, Mia Hutch is about to be promoted to Data Maintenance Manager. As the new manager, Mia has to learn a lot about data maintenance. Which of the following statements is FALSE? (1) One component of the maintenance program focuses on building permits and subdivision plats. (2) A periodic reinspection of all properties in the jurisdiction is important because undetected changes do occur. (3) Verifying existing information using a drive-by inspection in order to compare the property with the property record is unacceptable, as it will give false and inaccurate results. (4) Subdivision activity can create substantial value and should be inspected and maintained as soon as possible.
Answer: 3 Option (3) is false because drive-by inspections when the property and property record are being compared is usually adequate, as you are only verifying existing information. Options (1), (2), and (4) are correct statements concerning data maintenance.
9. Which of the following definitions is INCORRECT? (1) CPU: Central Processing Unit (2) RAM: Random Access Memory (3) ROM: Random Operating Memory (4) LAN: Local Area Network
Answer: 3 Option (3) is incorrect. ROM means Read Only Memory
5. Strom Thor is a data collector that has decided to retire and spend his days playing golf. His manager, George Walker, will have to hire and train someone to replace Strom. Which of the following is LEAST likely to be included in this training program? (1) Instruction on the general background of data collection. (2) Instruction on performing interior inspections. (3) Instruction on how to properly review the work performed by other data collectors. (4) Instruction on how to determine the quality of inspections.
Answer: 3 Option (3) is the correct answer. George will not likely train his new data collector to check the quality and review the work of other data collectors, because that is a responsibility for the field supervisor.
6. Which of the following statements accurately describes a disadvantage of the geographic organizational form? (1) The geographic organizational form violates the principle of determinate hierarchy. (2) Travel time is increased because appraisers have a wider expanse of geographical regions. (3) In a small jurisdiction, an appraiser is less likely to be able to specialize his/her appraisal skills to specific property types, than if a functional organizational form were applied. (4) Lines of responsibility are unclear because it is difficult to separate the duties involved in appraising the property as a whole.
Answer: 3 Options (1) and (4) outline disadvantages of the functional organization structure. Option (2) is incorrect because a geographic organizational form will decrease travel time due to the appraisers being assigned to a limited locale. Option (3) is a disadvantage of the geographic organizational form.
4. Which of the following statements is TRUE regarding time adjustments? (1) An advantage of paired sales analysis is the large sample size. (2) Resale analysis has too many adjustments to be a viable option. (3) Trend analysis can use most available sales. (4) Multiple regression analysis must have groups of paired sales to obtain a coefficient of time.
Answer: 3 Paired sales is analysis can suffer from small sample sizes of comparable sales. Resale analysis minimizes adjustments and multiple regression analysis does not require groups of paired sales to obtain a coefficient of time. Trend analysis can use most available sales.
2. Please refer to the following data: number of working days per month 20 number of residential parcels to be collected 40,000 average data collection rate 20 min/parcel number of working hours per day 8 complexity .90 required callbacks 6 parcels/day training days 10 density average; 1.0 travel time per day 1 hour ratio of data collectors/supervisors 5:1 collection period 6 months What is the expected field production rate per field collector for the project's six month duration (round your parcels per day to the nearest unit)? (1) 1,440 parcels (2) 2,520 parcels (3) 1,560 parcels (4) 2,880 parcels
Answer: 3 Parcels per day 24 (3 per hour 8 hours per day) Complexity factor .9 Callback factor (1 ) Travel Time (1 ) Training (1 ) 13 parcels/day 120 days 13 = 1,560 parcels
8. Which of the following statements is TRUE regarding the collection of income and expense data? (1) Personal interviews are the most inexpensive method of collecting income and expense data. (2) Mail questionnaires typically have high response rates. (3) Telephone interviews are not a good primary source of income and expense data. (4) There are no good third party sources for income and expense data.
Answer: 3 Personal interviews are a relatively expensive method of collecting income and expense data (especially in terms of staff time). Mail questionnaires generally have low response rates; and, there are a number of good third sources for income and expense data. Option (3) is true.
3. Which of the following is NOT a direct problem resulting from Proposition 13? (1) The system discriminates against growing families. (2) Valuation in California has become more complex. (3) The system is based on legality rather than market value. (4) There is an incentive to conduct property transactions so that reported sale prices appear lower.
Answer: 3 Proposition 13 has created several problems in the state of California including: a system that discriminates against growing families; incentives to conduct property transactions under the table; and appraisal, valuation, appeal, and administration functions have become more complex, with errors in inventory gathering and administration. Option (3) outlines the intent of the Proposition 13 legislation, rather than a direct problem resulting from it.
2. Which of the following statements are TRUE regarding the assessor's duties with respect to the completion of an assessment roll? A. An assessor is required to locate and identify all taxable property within their jurisdiction, to determine the extent of the taxability of each property according to legislation, and to notify the owners of the assessed value of their properties only if there has been a change made from the previous assessment. B. It is important for an assessor to make an inventory of all the important characteristics of all taxable property in order to ensure that taxes are applied equitably to similar properties. C. The property tax rate is applied to the market value of a taxable property if it is greater than the amount specified in the assessment roll. The assessor would be required to adequately justify this to the appeal body and to the taxpayer. D. Assessors are responsible for the assessment roll, and they must be able to justify the appraisal methods and valuations even if contract appraisers made the appraisals. (1) Both A and B are true. (2) Both D and C are true. (3) Statements B and D are true. (4) Statements A, B, and C are true.
Answer: 3 Statement A is false as, in most cases, owners must be notified of their assessment whether it has changed or not. Statement C is false because the property tax rate of each tax district is applied to the assessed value. Statements B and D are true.
4. Which of the following statements is/are TRUE? A. Local control of assessment promotes uniformity of administrative procedures. B. Canada has a more integrated property tax system than Denmark. C. Some countries only tax land. D. In Canada, property taxes are administered federally. (1) A and D (2) A, B, and C (3) C only (4) All of the statements are true.
Answer: 3 Statement C is the only true statement. Statement A is false, because central control of assessment promotes uniformity of administrative procedures. Statement B is false, because Denmark is well noted for its extensive integrated tax system. Statement D is incorrect, as property tax in Canada is administered locally by municipal governments.
10. The assessment administration system must provide for the calculation and processing of assessments, exemptions, and tax bills. What is another useful feature that this system could include? (1) Statistical testing (2) Security (3) Appeals processing (4) All of the above
Answer: 3 The assessment administration system could include appeals processing. Statistical testing is part of the sales system. Security is part of the data management system.
6. Which of the following statements regarding periodic ratio studies are TRUE? (1) A low coefficient of dispersion (COD) indicates that the central tendencies of the properties are not an accurate estimate of the market values of the given properties. (2) A high coefficient of dispersion (COD) indicates that the central tendency is an accurate representation of all the different market values of the given properties. (3) The coefficient of dispersion (COD) shows whether or not properties within an area or class are appraised uniformly. (4) All of the above statements are true.
Answer: 3 The coefficient of dispersion (COD) measures the average percentage with which the individual assessment ratios vary from the median ratio. A low COD indicates that the appraisals within the area are uniform and do not deviate extensively from the median. A high COD indicates that the assessed values of the properties are at varying or inconsistent percentages to the market values of the properties.
10. Regarding the decision reached in Metals and Alloys Co. Ltd. v. Regional Assessment Commissioner, No. 31, which statement is TRUE? (1) Once an item is determined to be a building, it is possible for it to be machinery as well. (2) An integration test should be used to determine whether a structure should be exempt from taxation. (3) It should first be decided if the structure is a building, and therefore subject to tax. (4) If an item that looks like a building is essential to the machine it encloses, it will be considered part of the machine.
Answer: 3 The decision reached in Metals and Alloys Co. Ltd. v. Regional Assessment Commissioner, No. 31 is important because it assists in determining the definition of a building. A building is taxable whereas machinery and equipment may either not be taxed or may receive favourable tax treatment. The Court decided that the structure must be considered on its own characteristics: if it looks like a building or is constructed like a building it should be considered a building and therefore be subject to tax. This is true even if the building is essential to the machinery it encloses. Prior to this decision, an integration test was applied. The integration test determined whether the process was an integral part of the overall or general process. If it was, it must be machinery. The integration test no longer applies given the decision reached in Metals and Alloys Co. Ltd. which has been affirmed in subsequent decisions. Option (1) is false because once an item is determined to be a building it is NOT possible for it to be machinery as well. Option (2) is false because an integration test was in common use before the Metals and Alloys case. Option (4) is incorrect because if a structure looks like a building and is constructed like one, it cannot be considered a machine as well.
7. Regarding the land titles system, which of the following statements is FALSE? (1) It is a record of all the various interests in a piece of land. (2) It guarantees the title of land by the province. (3) It guarantees the title of land to the province. (4) It is more commonly used in the western provinces.
Answer: 3 The land titles system is a public recording of interests in land where the title to land is guaranteed by the province. This system is more commonly used in the western provinces.
3. A photo image is distorted because the lens is not pointing at 90o to the ground. This above statement refers to which one of the following types of optical distortion due to aerial photography? (1) Relief displacement (2) Camera and lens flaw (3) Tilt displacement (4) None of the above
Answer: 3 Tilt displacement occurs when the aircraft is not flying on a perfectly level path, and the lens is not aiming straight downward at the time of exposure.
7. Two of the main components of a GIS are the application engine and the user interface. Which statement below is/are TRUE? (1) The user interface performs the data access and querying functions as requested by the user. (2) The main purpose of the user interface is to allow GIS specialists to use the system to its fullest potential. (3) The application engine performs all complex calculations and tasks that allow the user interface to function. (4) All of the above are true.
Answer: 3 The application engine performs all of the complex calculations and tasks that allow the user interface to function.
9. In an assessment office where duties are organized by the municipality of the entire region, a project has come up that is not part of the employees' regular duties. The manager needs to gather a group of 5 employees to complete this specific project. Once this project is complete, the employees can return to their regular duties. The new project calls for which type of organizational form? (1) Narrow span of control (2) Functional specialization (3) Geographic specialization (4) Task force
Answer: 4 A task force is a temporary arrangement of staff organized to accomplish a specific goal. Once the specific task is completed, employees return to their original job duties. Option (1) is incorrect, as a narrow span of control specifies a permanent structure, not a temporary arrangement in which one supervisor is responsible for the tasks of few employees. Such a structure is suitable for employees doing routine data control and entry. Options (2) and (3) are incorrect because both functional and geographical specialization can include task forces within their structures.
10. Tina Turnip is worried that the vendor "Dupeyew", which she hired to install a CAMA system, is not going to perform acceptable or timely work. On the other hand, "Dupeyew" does not particularly trust Mrs. Turnip to pay them for their contract. Which of the following options helps to ensure that the contractor will get paid, that the standard of work will be acceptable, and the work will be completed on time? (1) Bonuses can be given for work completed well and on schedule. (2) Payment can be held in escrow. (3) Penalty clauses can be imposed for poor workmanship and for time delays. (4) All of the above.
Answer: 4 All of the options are methods that ensure the contractor will get paid and that the standard of work is acceptable.
8. Regarding the facilitative style of management, which of the following statements is FALSE? (1) The style is characterized by low structure and high consideration. (2) Management and the organization's employees are seen as equals. (3) There is less delegation of tasks and more advising by management. (4) The manager exhibits a high degree of task orientation.
Answer: 4 All of the statements are correct except for statement (4). A manager exhibiting a high degree of task orientation is exercising a directive style of management.
8. Some assessment jurisdictions operate with legislation that stipulates the basis of valuation to be full market value or a fixed percentage of market value for all classes of property. Many of these jurisdictions also have provisions which direct appeal tribunals and the courts to consider equitable treatment of property owners when reaching their decisions on valuation appeals. Referring to the court's decisions in the Campeau Developments and Bramalea cases, what problems could you foresee if the appeal tribunals and courts gave priority to equity as opposed to the attainment of full market value, in their decisions? A. Over time, assessments could be lowered to the lowest assessment for the district. B. Assessment staff may tend to err on the side of low assessments to avoid appeals based on equity alone. C. The tax base would be eroded. D. Taxpayers with more funds would be more likely to appeal and succeed; eventually this could create a two-tiered assessment system (1) A and C. (2) B and D. (3) A, B, and D. (4) All of the above.
Answer: 4 All of the statements are problems associated with pursuit of equity rather than achieving market value.
8. Which of the following is a problem associated with levying a uniform ad valorem tax on both tangible and intangible forms of wealth? (1) Intangible personal property is easy to hide from the appraisers. (2) In today's economy, tangible personal property is difficult to value due to no active secondary resale market. (3) Double taxation of wealth may occur because some intangibles are wealth and some are rights over taxable tangibles. (4) All of the above are problems associated with levying a uniform ad valorem tax on both tangible and intangible forms of wealth.
Answer: 4 All statements are correct.
5. Certain property owners are typically granted exemptions from property taxation because of the benefits they provide to society; e.g., churches and non-profit assistance groups. Why would an assessor assess a tax exempt property? (1) If low intensity properties were not assessed, the property owner may be tempted to convert the property to a higher intensity use for a greater financial return. (2) A tax exempt property is assessed if it is not at its highest and best use and if the property owner wishes to sell the property on the open market. (3) An assessor should not assess the value of a property if it is tax exempt because it adds no contribution to the property values of a given jurisdiction. (4) An assessment informs taxpayers and government bodies of the amount of subsidy that the owners of tax exempt properties are receiving.
Answer: 4 An assessor needs to assess the property values of all the properties within a given jurisdiction, even those which are tax exempt. The purpose of an assessment is to provide property value and taxation information to property owners and government bodies, regardless of the current or intended use of the land.
2. Which of the following statements BEST describes "enterprise solution" for GIS in an assessment office? (1) The assessment office fully integrates GIS into the CAMA system (2) Seeking GIS solutions that address organizational needs, but also presents revenue-generating enterprising opportunities. (3) A whole system approach to data collection and analysis. (4) A government-wide approach that links multiple systems together, both assessment and non- assessment.
Answer: 4 An enterprise solution looks beyond the assessment office to a government-wide approach linking many systems together including assessment and non-assessment applications.
10. Viana Tush is currently using the data management system in her assessment office. Viana is impressed with the system because within a mass appraisal system, all data management systems have components for: (1) comparison, cost, editing, collection, and security. (2) screening, editing, collection, entry, and security. (3) comparison, storage, processing, entry, and cost. (4) collection, entry, editing, storage, and security.
Answer: 4 Components of a data management system include: data collection, data entry and editing, data conversion, data storage and security. Comparison and costs are functions of the valuation system. Screening and processing are functions of the sales analysis system.
10. Leigh Gershwin is considering implementing an ad valorem tax system in her city. Which of the following is a consideration in developing an optimal taxation system? (1) Administration and accountability. (2) Vertical equity. (3) Stable levels of tax revenue. (4) All of the above.
Answer: 4 Leigh should focus on all of the principles listed. Administration, accountability, neutrality, fairness (including horizontal and vertical equity), and a stable tax base are all important criteria that would exist in a good property taxation system
6. Maria Olet wants to select a vendor who will install a CAMA system. Which of the following statements describes aspects that Maria should be concerned with? (1) Whether the vendor is financially stable. (2) Whether the vendor's references are valid. (3) Whether the company has performed similar projects. (4) All of the above.
Answer: 4 Maria should be concerned with all of the options listed.
1. There are nine important items that should be included in a deed. Which of the following options accurately identifies three of these nine items? (1) Consideration; testimony clause; registered loans against the owner (2) Title; granting clause; legal description of the property (3) Witness; unrecorded conveyances; granting clause (4) Habendum clause; consideration; testimony clause
Answer: 4 Option (1) is incorrect because registered loans against the owner are recorded under the land title system. Option (2) is incorrect because title is conveyed by a deed and not included in a deed. Option (3) is incorrect because an unrecorded conveyance is a primary instrument used to convey title. Option (4) is the correct answer.
3. Which of the following definitions is correct? (1) A range edit is performed on qualitative data valuations. (2) Ad-hoc edits are developed by the computer supplier to correct problems discovered in the system during data collection. (3) Value edits are performed on numeric data to determine whether the value is consistent with allowable values. (4) Soft edits are used to identify values that are usually wrong, but may be correct in certain circumstances.
Answer: 4 Option (1) is incorrect, because the range edit is performed on numeric data elements to determine if the values fall between a specified minimum and maximum value. Option (2) is incorrect, as ad hoc edits are user-developed, not developed by the computer supplier. Option (3) is incorrect, as value edits involve checking the value against a list or table of allowable values. Values not on the list are rejected. Option (4) is the correct definition for soft edits.
6. An appraiser has relied upon the owner's information with respect to a property. Which of the following statements regarding appraiser's liability is FALSE? (1) If the appraiser did not make a reasonable effort to ensure that the advice was correct, then the appraiser can be held liable. (2) To be held liable, it is not necessary to establish that the appraiser knew the advice was incorrect. (3) There is a duty to take reasonable care to ensure that information is kept confidential. (4) It is necessary that the appraiser intended a particular act to cause harm in order to prove liability.
Answer: 4 Option (4) is the false statement. Intent to cause harm is not necessary to prove someone liable.
2. Which of the following is/are correct regarding paired sales analysis? (1) When many pairs are used the analyst can calculate an "average" rate of change. (2) It minimizes physical and locational adjustments. (3) It is rooted in the traditional direct comparison approach. (4) Both (1) and (3).
Answer: 4 Paired sales analysis has its roots in the traditional direct comparison approach and an "average" rate of change can be calculated if enough pairs are available. Resale analysis is the methodology that minimizes physical and locational adjustments.
1. Which of the following statements is FALSE regarding property taxation in Canada? (1) In some provinces, the provincial government is responsible for the whole assessment function. (2) In some provinces, charitable organizations are exempt from property taxation. (3) Mandatory exemptions from property tax liability are stipulated by provincial legislation. (4) Residential property typically bears a higher tax burden than commercial property.
Answer: 4 Residential property typically bears a lower tax burden than commercial property.
7. Which of the following statement(s) regarding the benefits received principle is/are TRUE? A. Taxpayers should pay according to their ability to pay. B. The value of one's real property is used as a proxy for one's ability to pay. C. It is not fair to fund people-related services such as schools and parks through property taxation because renters would be benefiting but not paying their share. D. A tax levied on the owners of real property is justified because benefits go to the properties. (1) Only A and B are true. (2) Only C is true. (3) Only C and D are true. (4) Only D is true.
Answer: 4 Statement D refers to the benefits received principle -- property taxes are justified because the services of local government accrue directly to property, such as roads, sewers, and fire protection. Statement A and B both refer to the principle of ability to pay. Statement C is false because contemporary theory on property tax incidence shows that renters also pay a share of property tax through their rent, and thus the benefits received principle can be used to justify using property taxes to pay for "people-related" services.
6. If the above parcel of land was described using the "lot and block" method, which of the following statements is/are TRUE? (1) Description of property location is easier, as there is no need to refer to compass bearings and distance measurements. (2) Each lot is surveyed using the metes and bounds description, and this information is recorded onto a map to which the lot is referenced. (3) The legal description of this lot can be referenced to this map and referred to by number (e.g., Lot 22, Block 5, Map Book 10, Page 20). (4) All of the statements are true.
Answer: 4 The "lot and block" method is a simple way of referencing lots once they have been surveyed using the "metes and bounds" method. Information from the "metes and bounds" method is compiled and recorded onto a map, so there is no need to use compass bearings and distance measurements when referring to a plot of land.
5. If you were surveying this property using the "metes and bounds" method, which of the following options would be the first statement of description when surveying this property? (1) Beginning at the north-west corner of the lot, move 92.4 feet 60o to the south-east corner of the property. (2) Beginning at the intersection of 2nd Avenue and Wright Road, move 80 feet either due north or due east. (3) Beginning at the reference point (north-east corner), move 126.2 due east to the north east corner of the property at 2nd Avenue. (4) Beginning from the reference point (brass disc) and facing north, move 22 feet 45o to the east, to the south-west corner of the property.
Answer: 4 The "metes and bounds" system describes the property using lines which are identified by length and compass bearing. Options (1) and (3) are incorrect because these statements do not begin from a set reference point that is not on the actual property. Option (2) is incorrect because it is does not specify a single direction in which to proceed, and it does not identify an exact starting point — where exactly in this intersection do you start from? For student's reference, the property illustrated would be surveyed as follows. Starting from the reference point (brass disc): • move 22 feet 45 to the east (N 45 E), to the south-west corner of the property; • move 80 feet due north to the north-west corner of the property; • move 126.2 feet due east (N 90 E) to the north-east corner of the property; • move 92.4 feet 60 to the south-west (S 30 W) to the south-east corner of the property; • move 80 feet due west (N 90 W) to the south-west corner of the property, to close or "bound" the property.
5. The bid process to buy a CAMA system begins when the request for proposals is issued. What is a step that the assessment office could perform when preparing and collecting bids? (1) Someone with experience should be assigned to review the bids. (2) Hire a consultant to assess the bid. (3) Talk to vendors at conferences and see demonstrations of their CAMA system. (4) All of the above.
Answer: 4 The assessment office should perform all of the steps when preparing and collecting bids.
3. Identify the three basic approaches to estimating the value of a taxable property. (1) Direct comparison approach, property analysis approach, appraisal approach. (2) Value estimate approach, cost approach, taxable income approach. (3) Value estimate approach, legal assessment approach, taxable income approach. (4) Cost approach, direct comparison approach, income approach.
Answer: 4 The three basic approaches an assessor uses in estimating the value of a property are the cost approach, the sales comparison approach, and the income approach. The other approaches are not recognized methods of estimating the value of a property.
