Friday, September 20, 2013

Chapter 6 Questions



1)      Money market lenders are very passive members in the commercial paper market.
a.       True
b.      False
2)      There no solely responsible party to blame for the 2008 crisis.
a.       True
b.      False
3)      Freddie Mac and Fannie Mae were at one time government sponsored enterprises but have recently become government agencies.
a.       True
b.      False
4)      The concept of highest and best use can be described as the most productive use that a property can be physically and legally dedicated to, maximizing its value.
a.       True
b.      False
5)      Depository financial institutions face a challenge called maturity mismatch when long term investments are funded with short term liabilities.
a.       True
b.      False
6)      Real estate markets establish prices to:
a.       Inform real estate investment decisions
b.      Stimulate or discourage real estate development
c.       Allocate space among competing land uses
d.      Establish land use patterns
e.      All of the above
7)      Which of the following is NOT a characteristic of a perfectly competitive market:
a.       Product and input mobility
b.      A free market
c.       Fluctuating product
d.      Perfect knowledge
8)      The supply/demand conditions and property characteristics that create real estate value in the market for a space is called ________.
a.       Situs
b.      Economic fundamentals
c.       Secondary mortgage market
d.      Subprime market
 
 
 
Answers: 1)F   2)T   3)T   4)T   5)T   6)E   7)C   8)B

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