18. A rational risk taker: a. specifies investment objectives carefully. b. makes investment decisions based on "tips". eliminates as much risk as possible. d. (a) and(c) above. a. b. a. 12. Real estate investors: a. may be active or passive investors, depending upon whether they take an equity or a debt position. b. always depend upon income tax benefits to make the investment successful. C. are required to exercise stand-by loan commitments. d. either directly or indirectly, purchase rights to a stream of future cash flows. 13. Real estate is an appropriate investment vehicle: for individuals, but not for institutions such as pension funds and life insurance companies. b. for institutions such as pension funds and life insurance companies, but not for individuals. C. for individuals and institutions, depending upon their time horizons and investment goals. d. for investors in debt instruments but not for investors in equity instruments. 14. Foreign investors: own more than 20 percent of U.S. real estate, but their holdings are widely disbursed across the United States. b. own a small portion (less than 5 percent) of U.S. real estate. C. have only recently (within the last decade) become interested in U.S. real estate. d. are not permitted to own U.S. real estate. 15. The investment decision process: a. is fundamentally the same for real estate investment analysis as for other investment areas. b. requires the investor to adjust expected cash flows for timing differences and risk. C. recognizes that investment assets are desired only for the benefits of ownership they bestow. d. all of the above are true. 16. The probabilistic estimate of the price at which a property will be sold is its: a. investment value. b. transaction price. most probable selling price. d. market value. 17. For a particular investment property, investment value: a. is determined by the selling price agreed upon by the buyer and seller. b. is the value placed on the property by a qualified appraiser. C. is the highest price a prospective buyer is justified in paying for the property. d. (a) and(c) above. Chapter 4 1. Which of the following is descriptive of data gathering by communication? a. It is more time-consuming than data gathering by observation. b. It is more objective than data gathering by observation. C. It is a more versatile means of data gathering. d. All of the above. 2. Market information can help serve which of the following functions? a Assist in developing reasonable cash flow projections Aid in purchase, divestiture, and refinancing decisions C. Facilitate operating decisions d. All of the above 3. The point of maximum net benefit derived from market research: a. is easily calculated by charting costs on the x- axis and benefit on the y -axis. b. is easily calculated by charting benefits on the x- axis and costs on the y-axis. C. is objectively measured. d. is not objectively measurable. 4. Which of the following is a step of the research process? a. Define the problem. b. Design the research strategy. c. Data interpretation d. All of the above 5. Which of the following is an example of primary data? a. Information taken from the Census of Population b. Data bought from university research studies C. Telephone interviews d. None of the above 6. Operating management uses research data for planning, problem solving and control purposes. Which one of the following is most likely to be used for control purposes? a. Data on basic trends in the economic environment b. Data on standard amenity packages included in competitive buildings C. Data on typical tenant mix in competitive commercial rental projects d. Tracking operating expense ratios for buildings in one's portfolio
