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Many investors buy land with the intention of subdividing it.

A) True
B) False

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Hal Lindon has an equity investment in a pool of student loans that have been purchased by Sallie Mae.What type of investment is this?


A) Limited partnership
B) Direct
C) Mortgage REIT
D) Hybrid REIT
E) Participation certificate

F) A) and B)
G) C) and E)

Correct Answer

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Austin has invested $25,000 as one of 10 limited partners in a large shopping center that was purchased for $800,000.The shopping center has been unsuccessful and the four general partners fear that the property could be foreclosed upon soon.What is the most Austin might lose if the project fails?


A) $80,000
B) $57,143
C) $200,000
D) $25,000
E) $20,000

F) B) and E)
G) A) and B)

Correct Answer

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One needs at least $25,000 to indirectly invest in participation certificates.

A) True
B) False

Correct Answer

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Jane Calvert owns a condominium at the beach which she rents out to vacationers.What type of investment does she hold?


A) Direct investment in real estate
B) Indirect investment in real estate
C) Equity REIT
D) Participation certificate
E) Mortgage REIT

F) B) and D)
G) C) and E)

Correct Answer

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Easing of international tensions or disinflation causes gold prices to:


A) skyrocket.
B) increase moderately.
C) remain stable.
D) decline.
E) change,but the direction of the change cannot be predicted.

F) A) and B)
G) A) and C)

Correct Answer

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Which of the following has lessened the appeal of investing in real estate?


A) Hedge against inflation
B) Professional management
C) Financial leverage
D) Tax Reform Act of 1986
E) National Association of Realtors

F) C) and E)
G) B) and E)

Correct Answer

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Stuart Michelson has invested in several pieces of real estate.Which one of the properties that Stuart owns would be considered commercial property?


A) 4 bedroom home that he does not rent out
B) 20 acre tract of farm land that is sitting idle
C) Fourplex that he rents to college students
D) 100 acres of land in the mountains that he hopes to subdivide and sell as residential lots
E) Vacation home

F) A) and B)
G) All of the above

Correct Answer

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Explain the difference between direct and indirect investments in real estate.Give examples of each.

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Real estate investments are classified a...

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The basic unit of gold bullion is one ________ of 0.995 fine gold.


A) kilogram
B) troy ounce
C) pound
D) ton
E) wafer

F) A) and E)
G) D) and E)

Correct Answer

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The price of gold is subject to daily fluctuations.

A) True
B) False

Correct Answer

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Which type of REIT pools money to invest in new shopping malls or self-storage facilities for the sole purpose of collecting rent?


A) Mortgage
B) Compound
C) Hybrid
D) Simple
E) Equity

F) B) and D)
G) B) and E)

Correct Answer

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Illiquidity in real estate means that:


A) you can quickly find someone who is willing to pay full value to purchase the property.
B) you don't have a water well on the property.
C) you cannot quickly sell the property at the market price.
D) you don't have financial leverage.
E) there is an efficient market for the property.

F) None of the above
G) A) and B)

Correct Answer

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Diane Chambers buys an apartment building for $2 million.Which one of the following demonstrates the highest degree of financial leverage?


A) $500,000 down payment and mortgage of $1,500,000
B) $250,000 down payment and loan of $1,750,000
C) $150,000 down payment and loan of $1,850,000
D) $100,000 down payment and loan of $1,900,000
E) $1 million down payment and loan of $1 million

F) B) and C)
G) A) and E)

Correct Answer

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General partners in a real estate investment venture have liability for ________ financial losses.


A) none of the
B) all of the
C) some of the
D) only exceptional
E) implied

F) B) and D)
G) C) and D)

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What are the possible advantages and possible disadvantages of investing in real estate?

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Possible Advantages: Hedge against infla...

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Your parents own a vacation home and find it more difficult to spend as much time there as they once did.They are thinking about continuing to use it as a vacation retreat but also want to periodically rent it and use it as an investment.Discuss the issues they should consider when making this decision.

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The after-tax cost of owning a vacation ...

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Which of the following is a possible disadvantage of real estate investments?


A) Lack of involvement in property maintenance
B) Hedge against inflation
C) Illiquidity
D) Lack of financial risk
E) Easy entry

F) B) and E)
G) C) and E)

Correct Answer

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Brian Wilson has several baseball cards passed down to him from his grandfather.He is particularly proud of the signed Hank Aaron baseball card that he has.What type of investment does he hold?


A) Direct investment in real estate
B) Indirect investment in real estate
C) Precious metals
D) Collectibles
E) Gems

F) A) and D)
G) A) and E)

Correct Answer

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A limited partner cannot take part in the management of the partnership.

A) True
B) False

Correct Answer

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Showing 101 - 120 of 156

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