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Humber College PREX-1060A Exam Syllabus Topics:

Humber College Exam 4: Invigilated Theory Sample Questions:

1. A land developer is interested in purchasing a piece of vacant land. Which of the following statements about evaluating the highest and best use of the real property is correct?

A) A property's highest and best use is the use that, at the time the building was built, was most likely to produce the greatest net return.
B) The estimate of value is related to how a typical buyer, with a reasonable knowledge of the market and property, wants to use the property.
C) A designated appraiser will use all factual sales data to determine the value of the current highest and best use of the property.
D) The land developer can identify the use of the property that is anticipated to produce the highest overall return so the appraiser can complete the appraisal.

2. When calculating the total purchase price of farmland with improvements on it, which of the following items is NOT included?

A) Goodwill
B) Fixed equipment
C) Residence
D) Barns and sheds

3. A salesperson has a buyer client in the metal fabrication industry, which requires outdoor storage and involves substantial noise and smells. The salesperson sees a listing that says "24,000-square-foot light industrial property, multi-uses permitted." Is this a suitable property for their client? Why or why not?

A) Yes, the property will be suitable if the client states they will change the zoning to allow their type and classification of business to operate at this location.
B) Yes, the property is suitable since the client is already in the metal fabrication business, and does not need to get any permits from the municipality prior to moving in and using the property.
C) Yes, the property is suitable, as the listing says the property is light industrial and multi-uses are permitted.
D) No, the property is not suitable, as the client's business type and classification require heavy industrial zoning.

4. A salesperson should know how to gather key information about a new commercial condominium, including the size of a unit. Which of the following sources of information should a salesperson rely on?

A) An opinion from the property manager
B) An opinion from the seller's lawyer
C) A surveyor's certificate for the unit
D) A sketch of the seller's floor layout

5. A landlord and a tenant have signed an agreement to lease an office space. Prior to the transaction closing, an unforeseeable event occurs that is not the fault of either party. Which statement about the return of the tenant's deposit is NOT correct?

A) The landlord and tenant may agree to split the deposit.
B) The parties may need to obtain a court order that clarifies how the deposit will be returned and distributed.
C) The tenant can have the deposit back without signing a mutual release as it is not their fault.
D) The agreement may contain a clause forfeiting all of the deposit if the landlord has started work on the premises.

Solutions: