Answers to the Practice PA Real Estate Exam Questions

  1. Answer: d.
    Brokerage fees are established solely as a result of a negotiated agreement between the broker and the consumer. The broker is required to disclose this to the consumer at the initial interview (Act Section 608(8)).  Fees are not determined by law, the Pennsylvania Real Estate Commission, or local brokers.
  2. Answer: d.
    License law prohibits a salesperson or associate broker from accepting a commission or any valuable consideration for the performance of any act specified in the law from any person except the licensed real estate broker with whom he or she is affiliated (Act Section 604(a)(12)).
  3. Answer: c.
    Written consent to act as a dual agent must include a statement of the terms of compensation (Act Section 606.4). Both parties must consent to the dual compensation.  Neither is required to be represented by attorneys, nor do they have to be related.
  4. Answer: d.
    The agent’s duty of confidentiality continues after the termination of the agency relationship. Information gained during the original agency relationship may not be revealed or used by the licensee for the benefit of the licensee or a third party (Act Section 606.1(g)).
  5. Answer: b.
    A licensed broker supervising the termination of a deceased broker’s business may continue to promote existing listings unless otherwise directed by the seller but may not enter into new listing agreements or hire new licensees. Pending contracts may continue until consummation (Rules Section 35.252(b)).
  6. Answer: d.
    A broker is permitted to act as a dual agent provided the broker secures the written consent of both parties to the transaction. The requirement is informed consent after full disclosure as provided at the initial interview (Act Section 606.4(a)).
  7. Answer: b.
    A salesperson selling or leasing her own real estate is required to disclose licensed status to a prospective buyer or lesee before an agreement is entered into. Rents are not required to be deposited into an escrow account.  Only the employing broker may compensate a licensed salesperson employed by that broker (Rules Section 35.288).
  8. Answer: d.
    The broker must disclose his license status prior to entering into an agreement with an owner (Rules Section 35.332(c)). A broker may not incorporate an option to purchase property in a listing agreement for the property, and the broker may not conduct business through a straw party.
  9. Answer: b.
    The salesperson’s failure to provide the Consumer Notice at the initial interview is a violation of the license law (Act Section 604(a)(15.1)). Licensees are subject to disciplinary action by the Pennsylvania Real Estate Commission, including possible suspension or license revocation.  The broker is not disciplined if the actions were taken without the broker’s knowledge.
  10. Answer: a.
    Pennsylvania law requires that the seller of a residential property provide the buyer with the property condition disclosure statement prior to the buyer’s entering into an agreement of sale with the seller.
  11. Answer: d.
    The property condition disclosure requirements pertain to most residential transactions and cover a broad range of issues affecting the property. The licensee should advise the seller of the disclosure requirements and the seller’s obligation to comply with requirements of the statute.
  12. Answer: a.
    The buyer may sue the seller and the broker who both have legal liability for disclosing a material defect that was known to them and not made known to the buyer prospect.
  13. Answer: d.
    Sale of a two-unit property owned by a licensee and sold for sale by the owner is not one of the exempt transactions, so the seller must make appropriate disclosures. The Real Estate Seller Disclosure Law describes nine instances in which disclosure requirements do not apply, including new construction covered by a builder’s warranty, foreclosure sale, and conveyance between one spouse and another.
  14. Answer: c.
    The Real Estate Seller Disclosure Law requires property condition and defects to be disclosed to the prospective buyer.  The current statute does not require disclosure of a situation such as the suicide of the former seller.
  15. Answer: c.
    There is currently no statutory requirement addressing the disclosure of the murder. Federal fair housing laws prohibit any discussion of AIDS or HIV.  Licensees must be aware of potential legal liability that could arise in this situation and should seek guidance from legal counsel.
  16. Answer: b.
    The governor appoints members to the Pennsylvania Real Estate Commission (Act Section 202(a)).  No endorsement from any professional organization to post a surety bond is required.  Salesperson licensees are not qualified to serve on the Commission.
  17. Answer: a.
    The Pennsylvania Real Estate Commission must include five members who are, at the time of appointment, licensed and qualified brokers under the existing law (Act Section 202).



  1. Answer: b.
    The Pennsylvania Real Estate Commission has the power and authority to administer and enforce the license law (Act Section 406). The Pennsylvania Association of REALTORS is a trade association whose members are licensees.  The Department of Housing and Urban Development is a federal agency that generally handles fair housing, not licensing issues.
  2. Answer: d.
    The purpose of laws, including licensing laws, is to provide for the good, safety, and welfare of the public. The rationale supporting the validity of the law is the government’s responsibility to ensure that the public is protected.
  3. Answer: a.
    The Pennsylvania Real Estate Commission administers and enforces laws governing the conduct of licensees (Act Section 404). The state legislature enacts laws that govern licenses.  The Department of State arranges for the services of a professional testing service to write and administer examinations (Act Section 403).
  4. Answer: d.
    Campground membership salespersons must be licensed and are subject to disciplinary action by the Pennsylvania Real Estate Commission (Act Section 581).  The State Board of Certified Real Estate Appraisers, not the Commission, regulates appraised firms.  Officers of banking institutions and attorneys-in-fact are excluded from the license law (Act Section 304).
  5. Answer a.
    License law provides that the employing broker might not be liable for a violation committed by a licensee employed by the broker. If the broker had actual knowledge of a violation, or if the licensee is engaged in a course of dealing that the broker should have been aware of, the employing broker could be liable (Act Section 702(a)(c)).



  1. Answer: b.
    License law prohibits a licensed broker from paying compensation to anyone other than her licensed employees or another broker, and it prohibits a salesperson from accepting compensation from anyone other than her employing broker (Act Section 604(a)(12)).
  2. Answer: b.
    License law specifically prohibits a broker from paying a commission or other valuable consideration to anyone other than his licensed employees or another real estate broker (Act Section 604(a)(12.1)).
  3. Answer: b.
    A licensee is required to notify the Pennsylvania Real Estate Commission of being convicted, pleading guilty, or pleading nolo contendere to a felony or misdemeanor within 30 days of the verdict or fee (Rules Section 35.290(a)). Being convicted in a court of competent jurisdiction in Pennsylvania or any other state could result in suspension or revocation of the broker’s license (Act Section 604(a)(14)).
  4. Answer: a.
    License law provides that any person who engages in business without being licensed is subject to criminal prosecution.  The first offense is a summary offense punishable by a fine not exceeding $500, imprisonment not exceeding three months, or both (Act Section 303).
  5. Answer: c.
    The maximum penalty would be a fine of $5,000 and imprisonment for a period of two years. Specifically, the penalty for conviction for a second or subsequent offense is a fine of not less than $2,000 but not more than $5,000, imprisonment for not less than one year but no more than two years, or both (Act Section 303).



  1. Answer: b.
    License law provides that the broker’s license may be suspended or revoked only if the broker had actual knowledge of the violation (Act Section 702(b)) or if the conduct of the salesperson demonstrated a course of dealing that could serve as prima facie evidence of knowledge on the part of the broker (Act Section 501(c)).
  2. Answer: b.
    Any person whose license has been revoked may reapply at the end of a five-year period from the date of revocation. The applicant must meet all of the licensing qualifications of the Act, including the examination requirement (Act Section 501(c)).
  3. Answer: d.
    The Rules and Regulations of the Pennsylvania Real Estate Commission require that a licensee notify the Pennsylvania Real Estate Commission of a conviction or pleading of guilty or nolo contendere to a felony or misdemeanor within 30 days of the verdict or plea. Likewise, if a licensing authority in another jurisdiction takes disciplinary action, the licensee must notify the commission within 30 days (Rules Section 35.290).
  4. Answer: a.
    The broker must obtain the written consent of the owner before erecting a For Sale or For Rent sign on the property (Act Section 604(a)(8); Rules Section 35.301(a)). The broker does not have to sell the property or obtain permission from the neighbors or local governing body.  It is permissible to have signs on open listings as well as on exclusive listings.  Written consent, however, is always required.
  5. Answer: c.
    An advertisement by a salesperson must contain the business name and phone number of the employing broker (Rules Section 35.305(b)). Real estate salespersons may not advertise under their own names.



  1. Answer: b.
    All licensees are required to disclose their license status in advertisements for property if the property is not listed for sale with a real estate company (Rules Section 35.304).
  2. Answer: c.
    A broker is required to advertise under the business name designated on the license (Rules Section 35.305). The listing price or name of the listing salesperson is not required in advertising.  A disclosure notice must be provided at the initial interview with a consumer.
  3. Answer: a.
    The Pennsylvania Real Estate Commission policy regarding Internet advertising requires that the broker’s name as it appears on the license must be included on each page of the site on which the firm’s advertisement occurs. The broker does not have to include license numbers, lists of licensees, or their addresses and phone numbers.
  4. Answer: a.
    Upon conviction for a first offense for practicing real estate without a license, the maximum penalty is a fine not exceeding $500, imprisonment not exceeding three months, or both (Act Section 303).
  5. Answer: a.
    Owners of real estate who list, sell, manage, or rent their own properties are exempt from license requirements (Act Section 304(1)).
  6. Answer: c.
    The unlicensed individual has no recourse. License law prohibits the filing of suits seeking recovery for conduct engaged in, in violation of the license law.  The terms consultant, counselor, agent, or finder are all directly included in the definition of a broker (Act Section 201).



  1. Answer: c.
    Any person who remains inactive for a period of five years without renewing his license must, prior to having a license reissued, take and pass the examination pertinent to the license for which he is reapplying (Act Section 501(b)). There is no education or training requirement as a condition to reactivating a license on inactive status for more than five years.
  2. Answer: d.
    Rules governing offices do not prohibit a licensed broker from employing salespersons or associate brokers when the broker’s office is located in a private residence. The rules do provide that the office must have a separate entrance, that the business name be displayed, and that the office allow for business to be conducted privately (Rules Section 35.342).
  3. Answer: a.
    Corporations, partnerships, and associations can be issued a broker’s license if the individual designated as the broker of record meets the individual requirements to be issued a broker’s license. The Pennsylvania Real Estate Commission processes license applications.  Employees engaging in the real estate business may hold a salesperson, rather than a broker, license.  Each individual is required to pay a fee to the Real Estate Recovery Fund (Act Sections 513 and 802).
  4. Answer: b.
    The education requirement for a salesperson is completion of 60 hours of real estate instruction in areas of study prescribed by the Pennsylvania Real Estate Commission (Act Section 521). Citizenship is not a requirement for licensure, nor is a degree from a college or university.
  5. Answer: b.
    A builder-owner salesperson applicant must take and pass the salesperson’s examination, but the license has no mandatory education requirement (Act Section 551). Campground membership and cemetery salesperson applicants have no examination requirement.  Rental listing referral applicants have both an education and an examination requirement.
  6. Answer: c.
    There is no examination or coursework required for a cemetery salesperson. Builder-owner sales persons (Act Section 551), rental listing referral agents (Act Section 561), and cemetery brokers (Act Section 531) are all required to pass a written exam prior to licensure.
  7. Answer: b.
    All licenses expere at the end of the license period established by the Pennsylvania Real Estate Commission. Salesperson and broker licenses all expire the last day of May in even-numbered years and must be renewed on or before June 1.
  8. Answer: c.
    Any persons employed by an owner for the purpose of managing or maintaining multifamily residential property are excluded under the license law with regard to certain activities they may perform (Act Section 304(10)). In this situation, collecting rents would not require licensure.
  9. Answer: d.
    It is illegal to engage in any activity for which a license is required until the license has actually been issued by the state. Completing the requirements for licensure and processing paperwork to the state does not mean that a candidate is licensed.
  10. Answer: a.
    Real estate licensees are not authorized to engage in appraisal activities, which are regulated by the State Board of Certified Real Estate Appraisers. Under the definition of a salesperson (Act Section 201; Rules Section 35.201), real estate salespersons are permitted to perform real estate activities for residential, commercial, and property management transactions and to negotiate real estate loans.



  1. Answer: b.
    A rental listing referral agent is defined as an individual or entity that owns or manages a business that collects rental information for the purpose of referring prospective tenants to rental units or locations of rental units (Act Section 201; Rules Section 35.201). Rental listing referral agents are not authorized to show rental units, collect fees or security deposits, or engage in property management activities.
  2. Answer: a.
    A builder-owner salesperson is a full-time employee of a builder-owner of single-family and multifamily dwellings who is authorized to list for sale, sell, lease, or rent any real estate owned by his builder-owner employer (Act Section 201).
  3. Answer: a.
    A time-share salesperson’s license is required to sell time-shares (Act Section 201). Employees of a public utility, trustees in bankruptcy, and licensed auctioneers are all exempt from licensing requirements (Act Section 304).
  4. Answer: b.
    The broker of record is the individual broker responsible for the real estate transactions of a licensed partnership, association, or corporation (Rules Section 35.201).
  5. Answer: c.
    Only licensed employees of the broker may hold open houses for the public and withdraw funds from the broker’s escrow account. Personal assistants may be employed by either the broker or salesperson to perform secretarial and clerical duties without being licensed.
  6. Answer: c.
    License law prohibits a licensee from accepting a commission or any valuable consideration for the performance of any act specified in the Act from anyone except the licensed real estate broker with whom he is affiliated (Act Section 604(a)(12)).
  7. Answer: a.
    License law prohibits a licensee from accepting compensation from anyone other than her employing broker (Act Section 604(a)(12)).
  8. Answer: c.
    The nondisclosure is a violation of the law. License law (Act Section 606.1(a)(13)) requires licensees to disclose to the consumer any financial interest (including referral fees) derived from services to be provided to the consumer by any other person, including inspection services.  License law prohibits a licensee from accepting compensation from anyone other than her employing broker (Act Section 604(a)(12)).
  9. Answer: d.
    The broker may thank the airline pilot. Brokers are prohibited from sharing fees with or paying compensation to an unlicensed person (Act Section 604(a)(12.1)).
  10. Answer: c.
    A purchaser has the right to cancel a time-share purchase until midnight of the fifth day following the date on which the purchaser executed the purchase contract (Act Section 609(a)). Any promotional prizes or gifts issued to the purchaser remain the property of the purchaser (Act Section 609(d)).
  11. Answer: b.
    Brokers and salespersons may fill in the blanks of preprinted contract forms but may not engage in the practice of law. Advising parties on the significance or consequence of contract terms is engaging in the practice of law and should be avoided.  The broker is a special agent hired with limited authority that ordinarily does not extend to binding principals to a contract.
  12. Answer: a.
    Opinions regarding condition of title to the property being sold could constitute the practice of law and should be avoided. Mandatory requirements and disclosures are addressed in Act Section 608.2(1), requirements regarding estimates of cost and return are addressed in Rules Section 35.334, and records must be maintained for three years (Act Section 604(a)(6)).
  13. Answer: d.
    A broker is responsible for depositing money into the escrow account by the end of the next business day following its receipt, unless both the buyer and the seller have given written permission for the broker to refrain from depositing the money pending the seller’s acceptance of the offer (Rules Sections 35.324(a)-(b)).
  14. Answer: b.
    Brokers are required to maintain a custodial or escrow account separate from any business or personal account. The broker is required to keep records of all funds deposited into the account.  There is no requirement to maintain a separate account or each deposit (Act Section 604(a)(5); Rules Section 35.325).
  15. Answer: a.
    License law provides that a broker involved in property management activities on behalf of a lessor be required to maintain a separate rental management account for such deposits (Act Section 604(a)(5)). The broker should not deposit rents in either an escrow account or the broker’s general business account.
  16. Answer: c.
    In cooperating broker transactions, the duty to escrow funds can be the responsibility of either broker. If the buyer gives the deposit to the listing broker rather than to the selling broker, the listing broker assumes the escrow duty (Rules Section 35.323(a)).  All parties must have a full disclosure as to which broker is holding the deposit in escrow.
  17. Answer: b.
    If a dispute arises, the broker retains the escrow until the dispute is resolved (Rules Section 35.327). A broker’s duty to escrow may not be waived or altered by agreement between the parties to the transaction, between the broker and the parties, or between the broker and other brokers involved in the transaction (Rules Section 35.322).  If the money is expected to be held in escrow for more than six months, the broker is encouraged to deposit the money into an interest-bearing account.  However, most escrow accounts do not bear interest.
  18. Answer: d.
    The Rules and Regulations of the Pennsylvania Real Estate Commission provide that the broker is responsible for depositing money into an escrow account by the end of the next business day following its receipt in the office where the escrow records are maintained. However, if the money is in the form of a check under an offer to purchase, the broker may, with the written consent of both buyer and seller, refrain from depositing the check pending the seller’s acceptance of the offer (Rules Section 35.324(b)).
  19. Answer: c.
    If an earnest money deposit is in the form of a check accompanying an offer to purchase, a broker may, with the written permission of both the buyer and seller, refrain from depositing the check pending the seller’s acceptance of the offer (Rules Section 35.324(b)).
  20. Answer: c.
    The broker must maintain an escrow account at a bank or recognized depository designating the broker as trustee. The broker is responsible for holding the escrow deposit pending consummation or termination of the transaction (Rules Section 35.321,.325).
  21. Answer: c.
    Both license law and fair housing law make it illegal for a broker to accept any listing on the understanding that illegal discrimination in the sale or rental of housing will be practiced. Accepting a listing of such conditions subjects the licensee to possible disciplinary action by both the Pennsylvania Real Estate Commission and the Pennsylvania Human Relations Commission (Act Section 604(a)(22)).
  22. Answer: d.
    Verification of income and credit checks to determine the applicant’s ability to meet financial obligations are legal and do not constitute discriminatory conduct. The broker may not refuse to rent based on the prospect’s age.  Anyone over the age of 40 constitutes a protected class in Pennsylvania.  The landlord may not discriminate based on age by different rental terms, such as security deposits or rental amounts.
  23. Answer:
    The Pennsylvania Human Relations Commission applies the same standards provided for in federal law (i.e., complaints must be filed within one year of the alleged violation).
  24. Answer: b.
    The Pennsylvania Human Relations Act specifically prohibits discrimination against handlers or trainers of service animals as well as persons with disabilities who use service animals. Any violation of the Pennsylvania Human Relations Act also constitutes a violation of the license law (Act Section 604(a)(22)).
  25. Answer: b.
    License law prohibits a salesperson or associate broker from accepting compensation from anyone other than her employing broker (Act Section 604(a)(12)).
  26. Answer: d.
    Salespersons and associate brokers are employed by and provide services on behalf of their employing broker. If the broker’s license is suspended or revoked, licenses of the associate brokers and salespersons are terminated.  To remain in active practice, the affiliates are required to find new employing brokers.
  27. Answer: b.
    The current license of all licensees employed by or affiliated with the broker must be maintained at the main office of the broker (Rules Section 35.245(a)). There is no requirement that the actual license be carried by the salesperson, that it be presented to consumers, or that it be prominently displayed.



  1. Answer: b.
    The salesperson license application must include a sworn statement from the employing broker certifying that the broker will actively and supervise the applicant (Rules Section 35.223(2)(i)). Education providers, not employing brokers, issue transcripts.  Citizenship is not a requirement for licensure.  Fees paid to the Real Estate Recovery Fund are the responsibility of the applicant rather than of the employing broker.
  2. Answer: d.
    The definition of a salesperson does not allow a licensed salesperson to engage in appraisal activity (Act Section 201). It does allow the salesperson to list for sale, sell or offer for sale, buy or offer to buy, or to negotiate the purchase, sale, or exchange of real estate and to negotiate a loan, lease, rent, or offer to lease or rent or place for rent any real estate.
  3. Answer: d,
    Disputes between an employing broker and salesperson employed by the broker are contract issues to be settled in a court of law. The Pennsylvania Real Estate Commission does not arbitrate such disputes.  Listings are not the property of the salesperson and cannot be unilaterally transferred to a new broker, and the Real Estate Recovery Fund is not available until all court action has been concluded.
  4. Answer: d.
    The current license of the broker and all licensees employed by or affiliated with that broker must be maintained at the main office of the broker (Rules Section 35.245(a)). The license is issued to the salesperson in order for him or her to provide service on behalf of the employing broker only.  There is no requirement that it be provided to consumers.
  5. Answer: c.
    In order to be licensed as a salesperson, the candidate must submit a license application with a sworn statement from the broker certifying that the broker will actively supervise and train the applicant (Rules Section 35.223(a)).



  1. Answer:
    The associate broker may manage a branch office on behalf of the broker.  When an associate broker changes employment from one broker to another, he may, in the interim, when the new license is being processed, maintain a copy of the notification sent to the Pennsylvania Real Estate Commission as a temporary license pending receipt of the new license (Act Section 603(a)).
  2. Answer: a.
    Act Section 608.1 establishes that any agreement between a broker and a principal, whereby the consumer is obligated to pay a fee, must be in writing and signed by the consumer. This includes brokerage agreements, whether for seller listing or buyer representation.
  3. Answer: b.
    A qualified expert’s report covering property condition is not required when a seller lists property for sale with a broker. In most transactions, state law requires the seller to complete a property condition disclosure form prior to entering into an agreement of sale.  The listing must state the broker’s fees, be in writing, and be signed by the seller, who must receive a copy of the listing after signing it.
  4. Answer: b.
    A listing contract is not required to specify the complete legal description of the property being sold. Mandatory provisions of exclusive listing contracts are established by Rules Section 35.332.  Exclusive listing contracts are required to contain the sales price, the expected commission, and the duration of the agreement.
  5. Answer: b.
    This clause is illegal in Pennsylvania because the Rules and Regulations of the Pennsylvania Real Estate Commission prohibit the use of automatic renewal clauses in exclusive listing agreements (Rules Section 35.332(c)(2)).



  1. Answer: d.
    License law requires the licensee to furnish a copy of the listing to all signatories at the time of execution (Act Section 604(a)(9)). Although brokers normally set up a listing file, advertise properties, and cooperate with other brokers, none of these activities is required by rule or statute.
  2. Answer: a.
    An exclusive-right-to-sell listing must include specific language in boldface type that the owner will be obligated to pay the brokerage fee even if the owner sells the property without the aid of the broker (Rules Section 35.332(a)(4)).
  3. Answer: a.
    When an initial interview takes place prior to entering into a listing, the broker must provide information about the broker’s policy regarding cooperation with other brokers (Act Section 608(6)). Commission rates are not determined by local custom.  Automatic renewal clauses are prohibited (Rules Section 35.332(c)).
  4. Answer: b.
    A licensee may enter into an oral open listing agreement if he provides the seller or lessor with a written memorandum stating the terms of the agreement (Rules Section 35.281(b)).
  5. Answer: a.
    Oral open listings with sellers are allowed, provided certain conditions are met (Rules Section 35.281(b)). Oral open listings may be used to create an agency relationship.  The statute of frauds does not apply to listing contracts.
  6. Answer: a.
    The required estimates of costs provided to the parties must be as accurate as may reasonably be expected of a person having knowledge of and experience in real estate (Rules Section 35.334(b)).



  1. Answer: a.
    Although all four options may be important issues to address in an agreement of sale, the Rules and Regulations of the Pennsylvania real Estate Commission specifically address the issue of the zoning classification. The zoning classification, unless the property is zoned for single-family housing, must be included or the buyer has the option of voiding the agreement with no requirement of court action (Rules Section 35.333(a)(6)).
  2. Answer: b.
    There is no requirement that a buyer include a copy of his credit report with an offer to purchase property. The Rules and Regulations of the Pennsylvania Real Estate Commission specify what must be included if an agreement of sale is conditioned on the ability of the buyer to obtain mortgage financing (Rules Section 35.333(b)).  These include a deadline for the buyer to obtain the loan commitment, assistance that the broker will provide the buyer, and the type of mortgage.
  3. Answer: b.
    The broker is required to keep records relating to real estate transactions for three years following consummation or termination of the transaction. Mandatory inclusions in agreements of sale include the following: copy of sales contract given to signatories, statement regarding broker’s services, and statement that access to a public road may require obtaining a highway occupancy permit (Act Section 608.2; Rules Section 35.333).
  4. Answer: a.
    The broker must provide each party with a written estimate of reasonably foreseeable expenses associated with the sale that the party may be expected to pay before an agreement of sale is executed (Rules Section 35.334(a)).
  5. Answer: c.
    Statements of cost and return must be presented prior to entering into an agreement of sale. They are expected to be as accurate as may reasonably be expected of a person having knowledge of real estate sales.  There is no requirement for signatures or disclosures of agency representation (Rules Section 35.334).
  6. Answer: b.
    There is no requirement for the broker to deliver copies to a mortgage lender. Licensees are responsible for ensuring that contracts are in writing (Rules Section 35.281(a)), that copies are preserved for a period of three years (Act Section 604(a)(6)), and that a copy of the agreement is presented to all signatories (Act Section 604(a)(9)).
  7. Answer: c.
    The amount of mortgage payment is not included in mortgage contingency clauses (Rules Section 35.333(b)). If an agreement of sale is conditioned upon the ability of the buyer to obtain a mortgage, the agreement must contain the type of mortgage, the maximum interest rate, and the deadline for obtaining the mortgage.
  8. Answer: a.
    There is no statutory or regulatory requirement for the rate or amount of the broker’s compensation to be disclosed in an agreement of sale. Mandatory provisions of an agreement of sale include disclosure to the parties regarding the role of the broker, the existence of the Real Estate Recovery Fund, and the zoning classification of property (Act Section 608.2).
  9. Answer: a.
    The Rules and Regulations of the Pennsylvania Real Estate Commission provide that an agreement of sale must contain the dates for payment and conveyance in addition to other specified items. Language addressing the seller’s responsibility for defects, zoning classification of single-family property, and mortgage financing language are not mandatory inclusions (Rules Section 35.333).
  10. Answer: b.
    When an aggrieved person obtains a final judgment against a licensee, the aggrieved party may file an application for payment from the Real Estate Recovery Fund. The maximum payment from the fund is $20,000 for any one claim (Act Section 803(d)).



  1. Answer: d.
    The Pennsylvania Real Estate Commission may reassess each licensee an amount not to exceed $10 if, at the commencement of a biennial renewal period, the balance in the Real Estate Recovery Fund is less than $300,000 (Act Section 802).
  2. Answer: c.
    In Pennsylvania, a borrower may cure default in a residential mortgage loan with an outstanding balance of $50,000 or less by merely bringing the payments up-to-date rather than by paying the entire outstanding debt. This may be done after default but before the foreclosure sale.
  3. Answer: c.
    The Rules and Regulations of the Pennsylvania Real Estate Commission do not dictate which broker must retain an earnest money deposit in an escrow account. Either the listing or selling broker may hold the deposit with proper notification to the buyer and seller (Rules Section 35.323).
  4. Answer: a.
    A licensee must notify the Pennsylvania Real Estate Commission of being convicted of, or pleading guilty or nolo contendere to, a felony or misdemeanor within 30 days of the verdict or plea.  The notification  requirement applies to any conviction, regardless of the offense involved (Rules Section 35.290).
  5. Answer: c.
    License law prohibits a salesperson licensee from accepting compensation from anyone other than the employing broker (Act Section 604(a)(12)). A broker licensee who provides insurance, construction, repair, or inspection services that are utilized by the consumer must provide the consumer with a written disclosure of the financial interest (including a referral fee or commission) that the broker has in the service.  The disclosure must be made when the broker first advises the consumer that the service is available or when the broker first learns that the consumer will be utilizing the service (Rules Section 35.283).



  1. Answer: c.
    A transaction licensee owes the duty of limited confidentiality and may not disclose to a buyer that the seller will accept a price less than the asking/listing price of the property (Rules Section 35.316). Providing assistance with document preparation, advising the consumer about compliance with laws pertaining to transactions, and keeping the consumer informed about tasks to be completed are all general duties of all licensees (Rules Section 35.292).
  2. Answer:
    A person acting as trustee in bankruptcy, administrator, executor, trustee, or guardian while acting under court order or under the authority of a will or trust instrument is not required to hold a real estate license (Act Section 304(5)).
  3. Answer: d.
    All fees required under the Real Estate Licensing and Registration Act are fixed by the Pennsylvania Real Estate Commission by regulation (Act Section 407).
  4. Answer: a.
    Licenses will be granted only to, and renewed only for, persons who bear a good reputation for honesty, trustworthiness, integrity, and competence to transact business (Act Section 501). Citizenship is not required for licensure.  A candidate must disclose details of convictions, but the disclosure does not preclude the possibility of licensure.  Financial solvency is not required as a condition of licensure.
  5. Answer: b.
    Whenever a licensed salesperson or associate broker desires to change employment from one licensed broker to another, the salesperson must notify the Pennsylvania Rel Estate Commission in writing no later than ten days after the intended date of change, pay the required fee, and return the current license (Act Section 603(a)).



  1. Answer: b.
    Unless otherwise agreed, a licensee owes no duty to conduct an independent inspection of the property and owes no duty to independently verify the accuracy or completeness of any representation made by a consumer to a transaction reasonably believed by the licensee to be accurate and reliable (Act Section 606.1(i)).
  2. Answer: c.
    The employing broker designated as trustee may give a licensed employee written authority to withdraw funds from the escrow account for payments that are properly chargeable to the account (Rules Section 35.325).
  3. Answer: d.
    A comparative market analysis may be prepared by a contracted buyer’s agent for the purpose of determining the offering price for a specified piece of real estate in an identified real estate market at a specified time (Act Section 201).
  4. Answer: a.
    The listing licensee is obligated to preent all written offers to the seller and to deal honestly and in good faith with non-represented parties. When representing the seller, the listing agent should inform the sellers of any details that might influence the seller’s decision, such as the buyer’s motivation to buy.  The listing agent owes confidentiality only to the clients; in this situation, the sellers.  Real estate licensees are not responsible for verifying the truthfulness of the seller property disclosure (Act Section 606.1(a)(3)).
  5. Answer: b.
    A licensee owes to all consumers the duty to exercise reasonable professional skill and care, honesty and good faith; to present all written offers and counteroffers; and to disclose any financial interest in the real estate transaction. The duty of confidentiality is owed only to clients – those who have actually hired the licensee for representation (Act Sections 606.1(a)(1)(2)(3)(5) and 606.1(g)).



  1. Answer: c.
    A licensee who represents a seller is obligated to be loyal to the seller’s interests and to make a continuous and good-faith effort to find a buyer for the property unless the property is subject to an existing agreement. Licensees are never responsible for conducting an independent transaction of the property and must always maintain confidentiality with regard to the seller’s intent (Act Section 606.2).
  2. Answer: c.
    In this situation, the licensee already represents the buyers and now also represents the seller. To act as a dual agent, the licensee must obtain the written consent of the sellers and the buyers before showing these buyers the listed property (Act Section 606.3(a)).
  3. Answer: d.
    In an agency relationship with a principal, the broker may, with the written consent of the principal, designate one licensee employed by the broker to serve as the designated agent of the principal to the exclusion of all other licensees employed by the same broker (Act Section 606.5(a)(1)).
  4. Answer: d.
    Licensees employed by a broker bear the same relationship to the consumer as the broker. In this situation, the licensees represent two different brokers, so they are acting as single agents, not as dual agents, or designated agents (Act Section 606).
  5. Answer:
    A transaction licensee is obligated to advise the consumer that the licensee is not acting as an agent or advocate of the consumer and must provide limited confidentiality (i.e., not disclose that the buyer will offer more than the offer or that the seller will accept less than the listed price (Act Section 606.6; Rules Section 35.316(2)).



  1. Answer: a.
    A dual agent may take no action that is adverse or detrimental to either party’s interest in the transaction, such as disclosing either party’s bottom line. Licensees are always required to disclose known defects about the property, such as a sinking foundation (Rules Section 35.314(3)).
  2. Answer: c.
    Some duties are owed to all consumers of real estate services, whether or not the licensee is acting as an agent or transaction broker. Specifically, licensees are obligated to provide a full accounting for all escrow and deposit funds, present all written offers, and disclose the licensee’s conflicts of interests and financial interests.  Licensees are not responsible for independent inspections of the property (Rules Section 35.292).
  3. Answer: a.
    Promptly on receipt.
  4. Answer: a.
    Commissions must be shared on a broker-to-broker basis.
  5. Answer: a.
    Brokers must set up the trust account for earnest money payments unless otherwise agreed by the buyer and seller.
  6. Answer: b
    Negotiation of the commissions on the board rate would be an example of violating antitrust law. The broker’s name must be included in an advertisement but it is not necessary to include the name of the salesperson.  It is perfectly legal for the broker to advertise free market analysis as a means of soliciting a listing.
  7. Answer: a.
    The broker must treat the customer fairly, but is required to get the seller the highest price possible.
  8. Answer: c.
    A latent defect would not be discovered by an ordinary inspection.
  9. Answer: a.
    The landlord is the lessor while the property manager is a general agent.
  10. Answer: d.
    The minor may enter into a contract; however, upon reaching majority age, the minor can either ratify (accept) or disaffirm (reject) the contract.
  11. Answer: c.
    The statute of limitations is the period of time within which one may judicially challenge a contract. The real estate commission is a regulatory body which is responsible for enforcing rather than making the law of the state.  The parole evidence rule provides that oral agreements modifying a written contract will not be admitted to modify or contradict a written contract in a court of law.
  12. Answer: d.
    An offer can be withdrawn at any time prior to the occurrence of binding acceptance.
  13. Answer: a.
    A bilateral contract would require two promises. An open listing would be enforceable but clearly is not an executed contract as the parties must perform.
  14. Answer: a.
    The seller in an open listing will have the right to sell a property himself without paying the listing broker a commission.
  15. Answer: d.
    The contract is not enforceable until binding acceptance occurs, which generally involves a signed and accepted contract to the seller.
  16. Answer: b.
    The broker’s rights would be protected based on the broker protection clause.
  17. Answer: b.
    Exclusive right-to-sell listing.
  18. Answer: c.
    The broker is required to disclose any known material fact that might affect the decision of the buyer.
  19. Answer: c.
    The contingency is not consistent with the terms of the listing thus relieving the seller of the obligation to pay a commission to the broker.
  20. Answer: d.
    The seller has the power to terminate but not necessarily the right, which could result in the seller’s being liable for damages.
  21. Answer: c.
    The salesperson is not a party to the contract. The exclusive right-to-sell provision prevents the seller from being able to avoid paying a commission.
  22. Answer: c.
    The first broker is protected under the exclusive right-to-sell provision while the second broker is entitled under procuring cause.
  23. Answer: c.
    The closing means that the contract is no longer anticipatory or executory.
  24. Answer: b.
    The listing salesperson is not a party to the contract which is enforceable.
  25. Answer: c.
    The salesperson works for the broker and may not receive a commission from anyone other than the broker for whom he works. Blind advertisements are prohibited.
  26. Answer: b.
    The quitclaim deed provides the least protection.
  27. Answer: d.
    The grantee does not sign the deed; nevertheless, the grantee must be named in the deed.
  28. Answer: a.
  29. Answer: c.
    The grantee must give constructive notice that he has an interest in the property. Constructive notice is given by recording the deed in the registrar of the deeds office or by occupying the property.
  30. Answer: d.
    Title insurance does not cover liens or defects listed in the policy.
  31. Answer: a.
  32. Answer: d.
    Selling and gifting property are examples of voluntary alienation.
  33. Answer: d.
    B will have equitable title until closing, after which B will have legal title.
  34. Answer: d.
  35. Answer: c.
  36. Answer: c.
    Section 1031 of the IRS does not allow real estate investors to either avoid or phase out the capital gain tax; it only allows the deferring of the tax.
  37. Answer: c.
    The annual percentage rate.
  38. Answer: d.
  39. Answer: b.
  40. Answer: d.
    Lodgings of a private club when the lodgings are not operated commercially.
  41. Answer: d.
  42. Answer: b.
    A Norwegian advertising his house for “Norwegians Only”.
  43. Answer: d.
    Lawful source of income.
  44. Answer: a.
    Lack of income.
  45. Answer: d.
    Americans with Disabilities Act (ADA).
  46. Answer: a.
    Charging higher rents for people with pets.
  47. Answer: c.
    Home inspection fees.
  48. Answer: d.
    Regulation Z.
  49. Answer: b.
    A leasehold estate, chattels, and trade fixtures are classified as personal property.
  50. Answer: b.
    When a person dies intestate, the descendant’s real estate and personal property pass on to her heirs according to statute.
  51. Answer: b.
    Rural development makes and guarantees loans to low-income people in rural areas. FHLMC is a warehouse agency in the secondary mortgage market.  FHA insures home mortgages.  Farms Service Agency makes and guarantees loans to farmers and ranchers.
  52. Answer: d.
    The words as long as are key to the creation of a determinable fee, sometimes referred to as a qualified fee, conditional fee, or base fee estate.
  53. Answer: b.
    Under an open listing, if the seller personally sells the property without the aid of any broker, the seller is not obligated to pay the commission.
  54. Answer: c.
    NAR is the REALTOR trade association. EEOC deals with discrimination in the employment, while ARELLO works with license law issues.
  55. Answer: c.
    $80,300 x 0.08 = $6,424 annual interest. $6,424 / 12 – $535.33 = $117.67 principal payoff.  $80,300 – $117.67 = $80,182.33 balance after the next payment.
  56. Answer: b.
    ($121,000 * 6.653) / 1000 = $805.013. Rounding up to the next penny yields $805.02.
  57. Answer: d.
    $804.65 * 360 months = $289,674. Subtracting the loan amount, $121,000, leaves $168,674 in total interest.
  58. Answer: d.
    A conventional mortgage is neither insure nor guaranteed by the government. A down payment generally is higher than with insure and guaranteed loans.
  59. Answer: a.
    $92,000 * 70% (0.70) = $64,400, assessed value / 100 = $644. $644 * $3.40 = $2,189.60 annual tax.
  60. Answer: d.
    The broker is not entitled to a commission because he had no contractual agreement with the buyer or the seller.
  61. Answer: c.
    The loan amount cannot exceed the DVA appraisal on a DVA loan. The veteran must pay the difference between the appraised value and the purchase price in cash.
  62. Answer: d.
    Payments on an amortized mortgage include principal and interest. A purchase money mortgage involves seller financing while a graduated payment mortgage has low initial payments that increase over time.
  63. Answer: a.
    Attachment refers to the act of taking a person’s property into legal custody or placing a lien thereon by court or judicial order to hold it available for application to that person’s debt to a creditor. An easement is the right to use the land of another for a specific purpose.  An appurtenance is a right, privilege, or improvement that belongs to and passes with the transfer of the property but is not necessarily a part of the real property.
  64. Answer: a.
    The relationship of the buyer to the listing licensee is of no concern to the selling licensee. Showing a property to a customer does not create an express agency.  Introducing the property to the buyer does not necessarily entitle the listing licensee to a portion of the selling licensee’s compensation.
  65. Answer: d.
    Brokers must report details of a closing to the IRS on form 1099S; Section 1031 of the Internal Revenue Code deals with a tax-deferred exchange.
  66. Answer: d.
    A reverse annuity mortgage becomes due on a specific date, the sale of the property, or the death of the borrower.
  67. Answer: a.
    A graduated lease provides for rent increase at set future dates, while a percentage lease provides for minimum fixed rent plus a percentage of the business income. Under a net lease, the tenant pays rent plus all or part of the property charges.
  68. Answer: d.
    The vendee (buyer) takes possession when the contract is executed.
  69. Answer: a.
    Leverage is using other people’s money to finance an investment. Arbitrage refers to buying and selling credit instruments to profit from differences in prices.  Novation occurs when a new obligation is substituted for an old one.
  70. Answer: d.
    The listing broker is required to prepare as well as submit all offers unless otherwise instructed. The broker does not have the authority to accept or reject those offers for the seller.
  71. Answer: c.
    The dominant tenement owner may terminate the easement right but does not pay the real estate taxes on the servient tenement. The dominant tenement owner may acquire his or her rights under an easement appurtenance by means other than by prescription.
  72. Answer: a.
    Tenants by the entirety must be husband and wife. Joint tenancy requires the interest to be equal.
  73. Answer: c.
    The different types of buyer brokerage agreements are discussed in your textbook.
  74. Answer: d.
    A mortgage is a voluntary act, not involuntary.
  75. Answer: c.
    $70,000 (first investor) + $40,000 (second investor) = $110,000. $200,000 – $110,000 = $90,000, the third investor’s contribution.  $90,000 / $200,000 = 0.45 or 45%.
  76. Answer: d.
    The broker is responsible for disclosing physical defects in the house, but to disclose that the seller would take less than the list price would be a violation of the broker’s fiduciary responsibilities to the seller.
  77. Answer: d.
    The key to this answer is being able to prove that fraud occurred.
  78. Answer: b.
    If the air-conditioning system is installed because of saleability, it would be contribution. In this case, the installation was due to the market availability of air-conditioned space.
  79. Answer: c.
    Neither Person A’s knowledge of Person B’s making a loan nor the size of such a loan would affect the priority of claims. The court could not rule in favor of Person B if he had signed a satisfaction.  A subordination clause is a clause in which the mortgagee (Person A) permits a subsequent mortgage (Person B’s loan) to take priority.
  80. Answer: c.
    $2,380 / 12 months = $198.33 per month. $198.33 / 30 days = $6.611 per day.  $198.33 * 6 months = $1,189.98.  $6.611 * 29 days = $197.719.  $1,189.88 + $191.719 = $1,381,699 or $1,381.70.  The taxes for the year have not been paid, and, when they are, the buyer will be in possession and have to pay the bill.  The seller, therefore, must pay (be indebted) for the portion of the year that he occupied the property.  The buyer receives a credit for the same amount.
  81. Answer: a.
    $4,100 – $600 salary = $3,500, commission sales. $3,500 / 3.5% (0.035) = $100,000, the value of the property sold.
  82. Answer: d.
    The broker may serve as an agent of the seller or any of the buyers. The broker could even represent a buyer and a seller in the same transaction, provided that he or she had the knowledge and consent of all parties involved.
  83. Answer: c.
    A zoning variance for commercial use is economic or locational obsolescence, which would be incurable.
  84. Answer: d.
    An individual must also have a current real estate license and have a written contract with the broker that states that the individual will not be treated as an employee for tax purposes.
  85. Answer: d.
    What is described in the question could be looked on as “legal” redlining. The lenders refused to loan because of the depressed economic conditions of the neighborhood, not because of the racial or ethnic makeup of the area.
  86. Answer: d.
    Start by adding the desired net of $14,000 PLUS the existing loan payoff of $108,750 and closing costs of $3,500 = $126,250, the minimum that the seller must receive. If the selling price is 100 percent, the commission is 7 percent, and the net to the seller is 93 percent, $126,250 is 93 percent of the selling price.  Therefore, $126,250 / 93% (0.93) = a selling price of $135,752.69, which is not one of the answer options.
  87. Answer: d.
    The sales comparison approach is considered the most reliable of the three approaches in appraising residential property.
  88. Answer: a.
    Installment sales of less than $3,000 are not covered by the imputed interest law.
  89. Answer: b.
    Under Section 1031 of the Internal Revenue Code, real estate investors can defer taxation of capital gains by making a property exchange. Property involved in the exchange must be of like kind – real estate for real estate.
  90. $40,000 gross income – $10,000 expenses = $30,000 net annual income. $30,000 net annual income / 12% (0,12) = $250,000, the value of the real estate.
  91. Answer: c.
    The owners must be husband and wife in tenancy by the entirety.
  92. Answer: b.
    Radon generally enters the house through the foundation or basement as well as through the crawl space.
  93. Answer: c.
    Liability under the Superfund is also considered to be retroactive, meaning that the liability is not limited to the current owner, but includes previous owners of the site.
  94. Answer: b.
    Deed restrictions (private land use controls) may not be used to discriminate against members of protected classes; they may be terminated by a quitclaim deed executed by the necessary parties.
  95. Answer: a.
    There is no double taxation as in a corporation. In other words, income losses and capital gains are passed directly to the shareholders.
  96. Answer: c.
    The gross rent multiplier (GRM) relates to monthly income, not annual.
  97. Answer: c.
    The gross rent and gross income multipliers are used as substitutes for the income approach. Assemblage is the joining of two or more properties.
  98. Answer: a.
    Other advantages of a franchise include management expertise and a client referral system. Disadvantages include loss of individual identity and high initial fees and franchise fees.
  99. Answer: d.
    Cash flow refers to net spendable income while company dollar is the amount of income that remains after subtracting all the commissions from the gross income. The cash method records income as received and expenses when actually paid.
  100. Answer: c.
    The broker may not provide fringe benefits such as health insurance. In addition, the broker may not withhold federal and state income taxes, social security taxes, or state unemployment insurance from commissions.
  101. Answer: a.
    A salesperson cannot place blind advertisements. The salesperson may not receive monetary compensation for a real estate transaction from anyone other than the broker for whom he or she is working.
  102. Answer: c.
    It is important to distinguish between earning and receiving a commission.
  103. Answer: d.
    The broker must not restrict the buyer’s freedom of choice.
  104. Answer: d.
    It is illegal under the federal fair housing law to accept a listing that involves discrimination, such as refusing to sell to members of a protected class.
  105. Answer: c.
    Functional obsolescence is a loss in value due to a deficiency in the floor plan or design of the house.
  106. Answer: d.
    Real property refers to physical land and appurtenances, including easements, water rights, mineral rights, and fixtures. Strawberry bushes are perennial plants and would be considered real property.  Percolating water and unexcavated clay would also be considered real property.  Personal property refers to anything that can be moved.
  107. Answer: a.
    Disclosing the lowest price that the seller will accept is a violation of the fiduciary relationship.
  108. Answer: c.
    A competitive market analysis is based on the ssales comparison approach to value.
  109. Answer: a.
    Double taxation is a primary disadvantage of the corporation form of ownership.
  110. Answer: c.
    $608,52 * 12 = $7,302.24. $7,302.24 / 10% (0.10) = $73,022.40.
  111. Answer: c.
    $62,400 * 7% (0.07) = $4,368, or $62,400 * 107% (1.07) = $66,768. $62,400 + $4,368 = $66,768.
  112. Answer: b.
    $104,000 * 70% (0.70) = $72,800 assessed value. Divide by 100 because the tax rate is stated per $100.  $72,800 / 100 = $728.  $728 * $3.35 = $2,438.80 annual taxes.  Divide by 12 to get monthly payments.
  113. Answer: c.
    Sales prices of similar properties are used in the market/data approach. The net income and capitalization rate are used in the income approach.  The owner’s original cost of construction would be irrelevant because in the cost approach the appraiser is concerned with the current replacement cost of the structure.
  114. Answer: b.
    The market/data approach is considered most reliable when appraising a single-family home. The income approach and capitalization approach are stressed in appraising commercial and industrial properties.
  115. Answer: a.
    The buyer’s down payment on an FHA loan is 3 percent of the first $25,000 and 5 percent of any amount more than $25,000.
  116. Answer: b.
    One point equals 1 percent of the loan.
  117. Answer: b.
    $167,750 sales price * 7% (0.07) = $11,742.50 broker’s commission. $11,742.50 * 65% (0.65) = $7,632.63 * 0.50 = $3,816, the selling person’s commission.
  118. Answer: b.
    The budget is the quantified business plan, while company dollar is the amount of income remaining after subtracting all commissions from the gross income. Gross income is the revenue earned from all the sources in a brokerage firm such as sales and management fees.
  119. Answer: c.
    Budget and company dollar were defined previously. Desk cost is the cost of providing the opportunity for salespeople to conduct their business.
  120. Answer: b.
    $200,000 annual overhead / 20 (10 desks * 2 salespeople each) = $10,000 desk cost.
  121. Answer: b.
    Puffing is sales psychology. Redlining is selecting specific areas and choosing not to make loans in that area; the areas generally are composed of members of protected classes.  Blockbusting is panic peddling.
  122. Answer: d.
    The vendee in a land contract holds equitable title until the land contract is paid in full, while the mortgagor receives legal title at closing.
  123. Answer: a.
    Loans with five or more installments would be covered. An agricultural loan for less than $25,000 would also be covered.
  124. Answer: a.
    Rental of rooms in an owner-occupied dwelling of five units or more is not exempted.
  125. Answer: c.
    An unrecorded deed is valid between the parties, but constructive notice must be given to protect against subsequent buyers of the property.
  126. Answer: d.
    An attorney-in-fact is a competent, disinterested person authorized by another person to act in his or her place. A Strawman is one who buys property for someone else to conceal the identity of the real buyer.  A trustee holds property in trust for another to secure the performance of an obligation.
  127. Answer: a.
    A broker may not commingle his personal funds with those of clients in a trust account.
  128. Answer: b.
    Limited liability companies may be directly managed by members or responsibility may be delegated to a property manager.
  129. Answer: d.
    Brokers generally are prohibited from representing and collecting compensations from both parties to a transaction unless both parties receive prior knowledge and give mutual consent.
  130. Answer: a.
    In this situation, you are the agent of the buyer and the listing broker is the agent of the seller.
  131. Answer: d.
    Answers 1, 2, and 3 are all characteristics of joint tenancy.
  132. Answer: d.
    A voluntary lien is a mortgage lien such as a lien created by an owner who obtains a mortgage loan. A general lien usually affects all the property of a debtor, both real and personal.  A specific lien usually is secured by a specific property.
  133. Answer: c.
    A roof that leaks would be an example of physical deterioration.
  134. Answer: b.
    The broker is entitled to a commission when she is employed by the seller and finds a “ready, willing, and able” buyer.
  135. Answer: d.
    The salesperson is an agent of the broker. When the salesperson no longer is employed by the broker, the broker retains any unsold or unexpired listings.  The status of the listings remains unchanged.
  136. Answer: a.
    1/8 * 1/8 = 1/64 square mile. 1/64 * 640 acres per square mile = 10 acres.
  137. Answer: b.
    FHA insurance is provided as protection for the lender.
  138. Answer: d.
    When an option is given, the optionee gives the optionor consideration, the price is determined, and the time is set. The optionee does not have to exercise the option.
  139. Answer: b.
    43,560 square feet per acre * 300 acres = 13,068,000 square feet. 13,068,000 square feet * (0.125) = 1,633,500 square feet for streets.  13,068,000 – 1,633,500 = 11,434 square feet for lots.  11,434,500 square feet / 280 lots = 40,838 square feet per lot.
  140. Answer: d.
    Reconciliation is the next-to-last step in the appraisal process.
  141. Answer: b.
    The listing agreement is an employment contract. The broker is “employed” to do only one thing and that is to find a “ready, willing, and able” buyer.  The broker, therefore, is a special agent, not a general agent.
  142. Answer: d.
    ADA requires that any employer with 15 or more employees must adopt nondiscriminatory employment procedures and make reasonable accommodations to enable an individual with a disability to perform in his or her employment.
  143. Answer: d.
    The broker is obligated to disclose to the buyer the material facts relating to the property.
  144. Answer: d.
    An estate for years is a lease for a definite duration whereas a periodic estate has an indefinite duration.
  145. Answer: d.
    The statute of limitations for initiating administrative proceedings is one year after the alleged discriminatory housing practice.
  146. Answer: c.
    $8,000 * 12 = $96,000 annual return. $96,000 / 8% (0.08) = $1,200,000 original cost of property.
  147. Answer: d.
    $200,000 current value – $123,000 current mortgage = $77,000 equity.
  148. Answer: b.
    A defeasible fee estate continues for an indefinite period. The period of ownership may be based on either a certain or uncertain event.  The words “so long as” indicate that the estate will be extinguished on the occurrence of the designated event; the charging of admission to the zoo, for example.
  149. Answer: b.
  150. Answer: c.
  151. Answer: b.
  152. Answer: c.
  153. Answer: c.
  154. Answer: b.
  155. Answer: b.
  156. Answer: b.
  157. Answer: d.
  158. Answer: d.
  159. Answer: d.
  160. Answer: a.
  161. Answer: a.
  162. Answer: d.
  163. Answer: c.
  164. Answer: c.
  165. Answer: c.
  166. Answer: d.
  167. Answer: c.
  168. Answer: b.
  169. Answer: d.
  170. Answer: d.
  171. Answer: c.
  172. Answer: c.
  173. Answer: b.
  174. Answer: a.
  175. Answer: a.
  176. Answer: a.
  177. Answer: b.
  178. Answer: a.
  179. Answer: a.
  180. Answer: a.
  181. Answer: a.
  182. Answer: b.
  183. Answer: b.
  184. Answer: c.
  185. Answer: c.
  186. Answer: b.
  187. Answer: c.
  188. Answer: b.
  189. Answer: d.
  190. Answer: d.
  191. Answer: d.
  192. Answer: c.
  193. Answer: c.
  194. Answer: b.
  195. Answer: d.
  196. Answer: a.
  197. Answer: d.
  198. Answer: a.
  199. Answer: b.
  200. Answer: b.
  201. Answer: d.
  202. Answer: a.
  203. Answer: c.
  204. Answer: d.
  205. Answer: c.
  206. Answer: c.
  207. Answer: b.
  208. Answer: d.
  209. Answer: a.
  210. Answer: c.
  211. Answer: c.
  212. Answer: b.
  213. Answer: b.
  214. Answer: d.
  215. Answer: b.
  216. Answer: a.
  217. Answer: b.
  218. Answer: c.
  219. Answer: b.
  220. Answer: d.
  221. Answer: d.
  222. Answer: d.
  223. Answer: a.
  224. Answer: b.
  225. Answer: b.
  226. Answer: c.
  227. Answer: b.
  228. Answer: c.
  229. Answer: d.
  230. Answer: b.
  231. Answer: d.
  232. Answer: c.
  233. Answer: b.
  234. Answer: d.
  235. Answer: d.
  236. Answer: d.
  237. Answer: a.
  238. Answer: d.
  239. Answer: a.
  240. Answer: b.
  241. Answer: a.
  242. Answer: b.
  243. Answer: a.
  244. Answer: d.
  245. Answer: b.
  246. Answer: b.
  247. Answer: b.
  248. Answer: a.
  249. Answer: c.






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