CHAPTER 17 QUIZ

1. The value of your house, not including the lot, is $91,000 today. What was the original cost if it has depreciated 5 percent per year for the past seven years?

2. What did the owners originally pay for their home if they sold it for $98,672, which gave them 12 percent profit over their original cost?

3. What would you pay for a building producing $11,250 annual net income and showing a minimum rate of return of 9 percent?

4. An owner agrees to list his property on the condition that he will receive at least $47,300 after paying 5 percent broker’s commission and paying $1,150 in closing costs. At what price must it sell?

5. A gift shop pays rent of $600 per month plus 2.5 percent of gross annual sales in excess of $50,000. What was the average monthly rent last year if gross annual sales were $75,000?

6. If your monthly rent is $1,050, what percent would this be of an annual income of $42,000?

7. Two Sponsoring Brokers split the 6 percent commission on a $73,000 home. The selling licensee was paid 70 percent of his broker’s share. The listing licensee was paid 30 percent of her broker’s share. How much did the listing licensee receive?

8. The buyer has agreed to pay $175,000 in sales price, 2.5 loan discount points, and a 1 percent origination fee. If the buyer receives a 90 percent loan-to-value ratio, how much will the buyer owe at closing for points and the origination fee?

9. Calculate eight months of interest on a $5,000 interest-only loan at 9.5 percent.

10. A 100-acre farm is divided into lots for homes. The streets require one – eighth of the whole farm, and there are 140 lots. How many square feet are in each lot?

11. What is the monthly net income on an investment of $115,000 if the rate of return is 12.5 percent?

12. A licensee sells a property for $58,500. The contract he has with his Sponsoring Broker is 40 percent of the full commission earned. The commission due the managing broker is 6 percent. What is the licensee’s share of the commission?

13. What is the interest rate on a $10,000 loan with semiannual interest of $450?

14. A warehouse is 80 feet wide and 120 feet long with ceilings 14 feet high. If 1,200 square feet of floor surface has been partitioned off from floor to ceiling for an office, how many cubic feet of space will be left in the warehouse?

15. The lot you purchased five years ago for $30,000 has appreciated 3.5 percent per year. What is it worth today?

16. A lease calls for $1,000 per month minimum plus 2 percent of annual sales in excess of $100,000. What is the annual rent if the annual sales were $150,000?

17. There is a tract of land that is 1.25 acres. The lot is 150 feet deep. How much will the lot sell for at $65 per front foot?

18. A woman earns $20,000 per year and can qualify for a monthly PITI payment equal to 25 percent of her monthly salary. If the annual tax and insurance is $678.24, what is the loan amount she will qualify for if the monthly PI payment factor is $10.29 per $1,000 of loan amount?

19. You pay $65.53 monthly interest on a loan bearing 9.25 percent annual interest. What is the loan amount rounded to the nearest hundred dollars?

20. What percentage of profit would you make if you paid $10,500 for a lot, built a home on the lot that cost $93,000, and then sold the lot and house together for $134,550?

21. An income-producing property has $62,500 annual gross income and monthly expenses of $1,530. What is the appraised value if the appraiser uses a 10 percent capitalization rate?

22. A man pays $2,500 each for four parcels of land. He subdivides them into six parcels and sells each of the six parcels for $1,950. What was his percentage of profit?

23. A property sells for $96,000. If it has appreciated 4 percent per year straight line for the past five years, what did the owner pay for the property five years ago?

24. If you purchase a lot that is 125 feet wide by 150 feet deep for $6,468.75, what price did you pay per front foot?

25. Calculate the amount of commission earned by a broker on a property selling for $61,000 if 6 percent is paid on the first $50,000 and 3 percent is paid on the remaining balance.