Monday, April 30, 2012

Chapter 12 Professional Activity


by Mario Jauregui 

True or False
Depreciation is when a decrease in value suffered by a property because of a diminished ability to serve the needs of its users and potential users typically due to age or functional disutility.

T



True or False
Income approach is one of the three valuation techniques taught to real estate appraisers requiring an estimate of the market value of the land combined with an estimate of the reproduction cost new of all improvements adjusted by estimated depreciation.

F: Cost Approach fits the description above.




Multiple Choice
The process of converting an income stream into a lump sum estimate of present value.
(A) Dual Agency
(B) Descriptive Appraisal Process
(C) Most Probable Sales Price
(D) Capitalization

D



Multiple Choice
Who is part of the developer’s team?
(A) Architects
(B) Engineers
(C) Contractors
(D) All of the Above
(E) Non of the above

D



True or False
A descriptive appraisal process is the process that an appraiser actually follows when valuing real property.

T



True or False
Value Estimate via Income Approach = Estimated Gross Monthly Rent x GRM

T



Multiple Choice
An analogous term for the prescriptive appraisal process, that systematic process that appraisers are taught to follow when valuing real estate is a   ________________.
(A) Normative Process
(B) Investment Value
(C) Market Value
(D) Non of the Above


A



True or False
Heuristics is the subconscious mental shortcuts employed by human problem solvers needing to minimize cognitive efforts.

T

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