CHAPTER 7 QUIZ

1. The income approach to value would be most important in the appraisal of a(n):

2. The effective gross annual income from a property is $112,000. Total expenses for this year are $53,700. What capitalization rate was used to obtain a valuation of $542,325?

3. When appraising real estate, the first consideration of the appraiser should be the:

4. In the valuation of a large apartment complex, the most weight would be given to which of the following approaches to value?

5. In the cost approach to value, the appraiser makes use of:

6. An appraiser who is using the sales comparison approach to determine value would use all of the following comparable properties EXCEPT a similar home that was:

7. All of the following are characteristics of value EXCEPT:

8. An appraiser is responsible for:

9. The term depreciation refers to the:

10. Which of the following would be classified as external depreciation?

11. It is necessary to calculate a dollar value for depreciation when using which of the following?

12. The income approach as used by an appraiser makes use of which of the following?

13. The sales comparison approach to value would be most important when estimating, the value of a(n):

14. Using which of the following would require the value of the land to be calculated separately from the value of the improvements?

15. Reconciliation is best described as:

16. A building is valued at $215,000 and contains 4 apartments that rent for $470 each per month. The owner estimates that the net operating income is 65 percent of the gross rental receipts. What is the capitalization rate?

17. The steps in the appraisal process include all of the following EXCEPT:

18. The gross rent multiplier is used as a guideline for estimating value based on:

19. Defined as a loss in value from any cause, depreciation is generally divided into three categories. The loss of value due to the normal wear and tear on a property is called:

20. To find the value of a property using the income approach to value, if the net operating income and the capitalization rate were known, the appraiser would:

21. An appraiser has been employed to estimate the market value of a parcel of vacant land. The resulting appraisal report would include reference to all of the following EXCEPT:

22. When appraising a commercial property, the appraiser is most concerned with the:

23. In the appraisal of an office building, which of the following would be classified as external depreciation?

24. The period of time over which an improvement to the property will contribute to its value is known as its:

25. Which of the following would be considered specific data?

26. When estimating the value of property using the cost approach, all of the following would be considered by the appraiser EXCEPT the:

27. The market price of real estate is generally the same as:

28. Reconciliation is an appraisal term used to describe:

29. An appraiser has been hired to prepare an appraisal on a property that includes an elegant old mansion that is now used as an insurance company office. Which approach to value would the appraiser rely on most?

30. A house with outmoded plumbing is suffering from:

31. By today’s standards, a 4-bedroom house with 1 bathroom would be considered to be:

32. In the cost approach an appraiser uses which of the following?

33. The purpose of an appraisal is to:

34. In the income approach, which of the following is NOT considered when calculating the net operating income?

35. A buyer is considering the purchase of an apartment building in an area where there is limited multi-family zoning. This situation would be BEST described by the economic characteristic of:

36. An appraisal report must contain all of the following EXCEPT:

37. The subject property has 3 bedrooms and 2 baths. A comparable property has 2 bedrooms and 1 bath. Which of the following is true?