1. The legal remedy for canceling a contract and restoring the parties to their orginal positions is called

A. recission

B. recapture

C. rejection

D. reversion

2. Which of the following must an agent of the seller do to fulfill fiduciary responsibilities to his principal?

A. insist on reviewing credit reports of prospective buyers to ensure they can afford a particular house before scheduling a showing

B. refuse to submit offers far below the sellers asking price

C. obtain power of attorney in order to take all reasonable actions on behalf of the seller

D. inform the seller if a buyer indicates a willingness to pay more for the property than she is presently offering

3. What is required to establish mutual assent?

A. meeting of the minds

B. rejection of an offer

C. offer and counteroffer

D. an offer that meets the listing price

4. A low loan- to- value ratio indicates a

A. a lower equity in the property

B. greater risk of foreclosure

C. higher equity in the property

D. greater use of leverage

5. If known, the listing broker must disclose which of the following to prospective buyer ?

A. That the seller's mortgage is assumable

B. That the seller has accepted a position in another state

C. That the seller has filed for divorce

D. That the sellers water system is contaminated

6. Two persons own a property as tenants in common, if one dies, what happens to the ownership of the property?

A. The survivor becomes sole owner

B. The survivor becomes a tenant in common with the heirs of the deceased

C. The survivor becomes a joint tenant with the heirs of the deceased

D. The property must be sold and the proceeds distributed

7. A buyer is planning to purchase a house that costs $120,000. If she obtains an 85% loan and the lender charges a 1.5% loan origination fee and 1.5 discount points, what is the cost of these expenses?

A. $1,800

B. $2,550

C. $3,060

D. $3,600

8. The clause designed to ensure that a broker will receive a commission if negotiation with a ready, willing, and able buyer are completed after the listing has expired is called

A. An acceleration clause

B. An allenation clause

C. A coinsurance clause

D. An extension or "tall" clause