Question
Flag question: Question 1 Question 1 1 pts A client wants to reduce the property's hazard insurance coverage substantially, in order to save money on
Flag question: Question 1Question 1
1 pts
A client wants to reduce the property's hazard insurance coverage substantially, in order to save money on the premiums. If the property manager tries to arrange this, the insurance company might:
Group of answer choices
terminate coverage based on a charge of fraud
keep the policy in force, but lower the client's credit rating
agree to reduce the coverage only if the deductible is increased by a corresponding amount
refuse to reduce the coverage, because insurers generally require that property be insured to at least 80% of its value
Flag question: Question 2Question 2
1 pts
A continuous operation provision in a lease is most likely to apply to:
Group of answer choices
an anchor tenant in a shopping center
the landlord of a stand-alone retail property
a tenant leasing Class C office space
the owners association in a condominium or other CID
Flag question: Question 3Question 3
1 pts
A conversion ratio measures:
Group of answer choices
how much of the multi-family housing stock in this market has been converted to condominiums
how many prospects it takes to get a signed lease for a rental space
what percentage of a property's tenants have occupied their spaces for over one year
what percentage of a property's tenants renew their leases if offered the opportunity
Flag question: Question 4Question 4
1 pts
A developer builds a large office tower in a city where there is a shortage of office space and rents are high. This will:
Group of answer choices
increase demand, which will tend to lower rents
increase demand, which will tend to increase rents
increase supply, which will tend to lower rents
increase supply, which will tend to increase rents
Flag question: Question 5Question 5
1 pts
A difficult and tight-fisted client is making it just about impossible for Serena to maintain and operate the property in compliance with landlord-tenant laws and other legal requirements. Assuming that their management agreement is typical, which of the following is correct?
Group of answer choices
The client's failure to keep the property in compliance with legal requirements is a breach of the management agreement
The contract requires Serena to use her own funds to prevent legal violations if the client fails to do so
Serena is contractually liable for any fines, damages, or other penalties that result from legal noncompliance
Serena is contractually obligated to report the legal violations to the appropriate authorities
Flag question: Question 6Question 6
1 pts
A lease in which all of the operating expenses are passed through to the tenant is called a:
Group of answer choices
triple net lease
CAM lease
gross lease
shadow lease
Flag question: Question 7Question 7
1 pts
A maintenance employee assaulted one of the tenants in a building that Clive manages. Clive hired and supervised the employee. Regarding Clive's potential liability in connection with this incident, which of the following is correct?
Group of answer choices
Clive can't be held liable because he didn't authorize the employee's action
Clive's liability is likely to depend on whether he was negligent in his hiring, supervision, or retention of the employee
Clive can be held liable only if he failed to do a criminal background check when the employee was hired
Clive can be held liable only if he participated in the incident, benefited from it in some way, or assisted the employee after the fact
Flag question: Question 8Question 8
1 pts
A maintenance request form for tenants to fill out should include:
Group of answer choices
an estimate of how long the work is likely to take
a hold harmless clause, protecting the manager against liability for work negligently performed
work order and purchase order numbers, if applicable
an authorization for entry into the tenant's rental space or unit, to be signed by the tenant
Flag question: Question 9Question 9
1 pts
A new client who just inherited a commercial building has told her property manager that she doesn't plan to sell the property, but her primary financial goal is a quick, high return. In this situation, the manager should:
Group of answer choices
persuade the client to sell the property, even if that isn't in the manager's self-interest
realize that the client will probably be reluctant to authorize any expenditures unless they're necessary to maintain or increase the property's net income in the short term
explain the income tax consequences of that choice to the client
tell the client that his fiduciary duties do not allow him to represent her on those terms
Flag question: Question 10Question 10
1 pts
A new commercial tenant is requesting build-out work that will cost more than the agreed improvement allowance. The property manager should:
Group of answer choices
notify the tenant that the requested improvements will have to be scaled back
remind the tenant that any construction costs in excess of the allowance will be the tenant's responsibility
increase the allowance to cover the additional work, as long as the changes will increase the value of the property as a whole
consult with the client before agreeing to increase the tenant's improvement allowance
Flag question: Question 11Question 111 pts
A property manager has a legal obligation to protect and promote her client's interests. This is because the manager:
Group of answer choices
is the client's agent and owes the client fiduciary duties
is a member of a professional association with a code of ethics that specifically requires this
is subject to the Uniform Standards of Professional Property Management
has signed a contract (the management agreement) that expressly requires this
Flag question: Question 12Question 121 pts
A property manager is preparing a management plan for a new client's property. The manager's property analysis:
Group of answer choices
should focus primarily on the property's physical condition at this stage
should include an evaluation of the property's current operations, leasing, management, and financial condition, as well as its physical condition
should be performed after the market analysis, for most types of property
must be based on an appraisal performed by a state-licensed or -certified appraiser within the previous six months
Flag question: Question 13Question 131 pts
A property manager is deciding on a marketing plan for a vacant retail space. How much advertising will be needed in order to find the next tenant for the space is most likely to be affected by:
Group of answer choices
branding
the target market
the property's location
the cost per prospect
Flag question: Question 14Question 141 pts
A property manager is doing a preliminary study in order to prepare a management plan. As usual, the preliminary study will involve five main categories of analysis. These categories include all of the following, except:
Group of answer choices
analysis of alternatives
analysis of demographics
regional analysis
neighborhood analysis
Flag question: Question 15Question 151 pts
A property manager may suggest physical changes to a client's property in order to correct or address different forms of depreciation. Which of the following is true?
Group of answer choices
Correcting curable external obsolescence is called remodeling
Correcting curable physical deterioration is called remodeling
Correcting curable functional obsolescence is called rehabilitation
Correcting deferred maintenance is called rehabilitation
Flag question: Question 16Question 161 pts
A property manager needs a bad debt and vacancy factor for a residential property's annual operating budget. She is most likely to:
Group of answer choices
check the MSA website to see projected average vacancy rates for her area
evaluate the property's actual rent collection record in previous years
base it on changes in the Consumer Price Index
use the figure agreed to in the management agreement
Flag question: Question 17Question 171 pts
A property manager rejected a rental application for a retail space because of the applicant's race. Was this legal or illegal?
Group of answer choices
Legal, because this is commercial property and the Fair Housing Act applies only to residential property
Legal, because antidiscrimination laws apply to real estate sales transactions, not lease transactions
Illegal, because any discrimination by a property manager is a violation of the manager's fiduciary duties
Illegal, because the Civil Rights Act of 1866 prohibits discrimination based on race or color in all real estate transactions
Flag question: Question 18Question 181 pts
A property manager records rents collected from tenants when they are actually paid (not merely owed), but he records certain operating expenses as they accrue (as opposed to when they're paid). This manager is using the:
Group of answer choices
payment point accounting method
certified accounting method
modified cash-basis accounting method
triple-entry accounting method
Flag question: Question 19Question 191 pts
A property manager should not give "welcome to the building" gifts to new tenants:
Group of answer choices
that cost more than $25, the legal limit
because such gifts are a form of illegal kickback
unless all tenants receive exactly the same gift
without the property owner's prior authorization
Flag question: Question 20Question 201 pts
A property manager's rent collection records should include:
Group of answer choices
both a rental ledger and a rent roll
either a rental ledger or a rent roll
a rental ledger rather than a rent roll
a rent roll rather than a rental ledger
Flag question: Question 21Question 211 pts
A rental application form or packet should include:
Group of answer choices
an inquiry regarding race, ethnic background, familial status, and disability, to enable the manager to demonstrate Fair Housing Act compliance
an authorization for a citizenship status check, signed by the applicant, for Patriot Act compliance
an authorization for a credit check (and a criminal background check, if desired), signed by the applicant, for FCRA compliance
an authorization for entry without notice in emergencies, signed by the applicant, for URLTA compliance
Flag question: Question 22Question 221 pts
A residential lease should be signed by:
Group of answer choices
everyone who will occupy the unit
all competent adults who will occupy the unit
only one competent adult, as the fully liable representative of all other occupants
only the occupant(s) who have accepted joint and several liability for the rent, at least one of whom must be a competent adult
Flag question: Question 23Question 231 pts
A residential property manager looking for new tenants for a single-family rental house rejects an application from two men because she thinks they are gay. Which of the following is true?
Group of answer choices
Sexual orientation is not one of the protected classes in the federal Fair Housing Act
The federal Fair Housing Act does not apply to the rental of single-family homes
The property manager did not personally violate the law if the property owner gave her written instructions not to rent to homosexuals
The property manager has violated the federal Fair Housing Act
Flag question: Question 24Question 241 pts
A retail space that is separate from a mall's main shopping area but still within the boundaries of the parking lot is called:
Group of answer choices
an island
a satellite space
an outparcel
a magnet store
Flag question: Question 25Question 251 pts
A tenant who pays rent on a monthly basis has abandoned the leased space when there are still six months remaining in the lease term. In this situation:
Group of answer choices
the space cannot be leased to a new tenant until the former tenant's lease term expires
the former tenant can be held responsible for no more than three months of additional rental payments
the former tenant is still liable for the rent for six more months, even if a new tenant is found right away
the former tenant could still be liable for the rent for six more months, but the landlord or manager must make an effort to find a new tenant promptly
Flag question: Question 26Question 261 pts
Administrative regulations:
Group of answer choices
are merely guidelines, without the force of law
may be federal, state, or local
are enacted by a legislative body
apply only in a particular city or county
Flag question: Question 27Question 271 pts
After an apartment building's operating expenses and mortgage payment have been paid, the amount of money left over from the rents collected that month is called the:
Group of answer choices
equity
leverage
appreciation
cash flow
Flag question: Question 28Question 281 pts
All of the following statements about industrial parks are correct, except:
Group of answer choices
Industrial parks are also called business parks
They typically have single-story shell buildings with high ceilings
They may be developed as condominiums
They usually allow only manufacturing uses, so that business offices and warehouses must be located elsewhere
Flag question: Question 29Question 291 pts
All of the following investor-owners would be likely to hire a professional property manager, except:
Group of answer choices
Mary Ann, a surgeon who owns a residential duplex and rents both units to tenants
Paul, a commercial fisherman who owns 20 acres of undeveloped land that he's holding for appreciation
the Cartwright Group, a partnership that recently purchased and renovated an 80-unit apartment building constructed in the 1920s
Ernesto, a retiree who owns a small office building and lives in another state
Flag question: Question 30Question 301 pts
An R/U ratio is often used to determine:
Group of answer choices
the maximum number of people that can legally occupy a residential unit
the optimum number of smaller stores for a shopping center with a particular type of anchor store
how much a commercial tenant will have to pay toward the building's common area expenses
how many parking spaces a retail building will need in order to accommodate customers and employees
Flag question: Question 31Question 311 pts
An asset manager's services would include:
Group of answer choices
paying the property taxes and insurance premiums for a client's property when due
evaluation of whether a client's property is serving its highest and best use
hiring and supervising the staff for a client's property
heading the leasing team for a client's property
Flag question: Question 32Question 321 pts
"Any allocation of funds that is expected to generate a profit for the owner" is a definition of:
Group of answer choices
appreciation
dividend
investment
security
Flag question: Question 33Question 331 pts
Anya is preparing a management plan for an office building. In her regional analysis, Anya is likely to be especially interested in data concerning:
Group of answer choices
average family size
HVAC alternatives
consumer trends
future employment growth
Flag question: Question 34Question 341 pts
As a general rule, and without reference to specific provisions in the lease agreement, notice of termination is required:
Group of answer choices
only when a landlord (or his property manager) wants to end a tenant's periodic tenancy
when a tenant wants to end a term tenancy
when either the landlord or the tenant wants to end a periodic tenancy
when either the landlord or the tenant wants to end a term tenancy
Flag question: Question 35Question 351 pts
As a general rule, employees who work under a property manager need to be bonded only if:
Group of answer choices
the property owner requests it
they handle money as part of their job
they have a criminal record
the property's hazard insurance does not cover them
Flag question: Question 36Question 361 pts
At one of the properties Tyree manages, rent is due by the fifth of the month; if payment is received after 5:00 PM on the fifth, a flat $50 late fee is imposed. The biggest disadvantage of this policy is that:
Group of answer choices
most tenants will wait until the fifth to pay, instead of paying on the first of the month
once tenants have incurred the late fee in a given month, they have no incentive to get the rent paid sooner rather than later
imposing a late fee gives tenants the impression that late payment is acceptable
adding a late fee only makes it more difficult for delinquent tenants to pay the overdue rent
Flag question: Question 37Question 371 pts
Ava and Benjamin are organizing an investment syndicate to purchase an income property. They're planning to invite various business associates and acquaintances to participate. All of the following are true, except:
Group of answer choices
the syndicators may manage the property themselves or hire a professional property manager
federal and state securities laws may apply when the syndicators offer interests in the syndicate to others
the syndicators must have unlimited liability, although the other participants may have limited liability
collaborating with other investors will enable them to purchase a larger, more expensive property than they could on their own
Flag question: Question 38Question 381 pts
Banks generally won't finance development of a new shopping center:
Group of answer choices
unless there will be at least four anchor tenants
until the developer has signed lease agreement(s) with the anchor tenant(s)
until the land has been purchased and the site infrastructure prepared
if there is already another shopping center of similar size and character within a ten-mile radius
Flag question: Question 39Question 391 pts
Breakpoints are a feature of:
Group of answer choices
percentage leases
industrial leases
high-rise buildings
annual operating budgets
Flag question: Question 40Question 401 pts
Buying real estate as an investment has some disadvantages compared to various other types of investments. One disadvantage is that:
Group of answer choices
no tax deductions apply to real estate owned as an investment (as opposed to personal use property)
a real estate purchase generally requires a larger cash outlay than other investments
real estate can't be expected to depreciate as quickly as other investments
real estate provides a return to the investor only when the asset is sold
Flag question: Question 41Question 411 pts
Byron keeps trust funds for all of his property management clients in a single pooled account. It's an interest-bearing account, specifically designated as a trust account, in a financial institution whose accounts are insured by the Federal Deposit Insurance Corporation (FDIC). The pooled account's balance is $380,000, and the FDIC's coverage limit is currently $250,000. Which of the following is correct?
Group of answer choices
Because the pooled account's balance exceeds the coverage limit, none of the client funds in the account are insured
Because the pooled account's balance exceeds the coverage limit, the excess funds are uninsured
The FDIC's coverage limit is applied to each client separately, even when their funds are pooled together in a single trust account, so all of the funds may be insured
The FDIC will not insure a client's funds in a pooled trust account if that client has any other money deposited at the same financial institution
Flag question: Question 42Question 421 pts
Do Not Call laws:
Group of answer choices
do not apply to property managers who are licensed real estate agents
prohibit cold calls to people who have listed their phone numbers in the FTC's Do Not Call Registry
prohibit cold calling altogether
prohibit cold calling, and also prohibit returning calls from people who don't already have an established relationship (as client or tenant) with the manager
Flag question: Question 43Question 431 pts
Edie is evaluating applicants for a vacant apartment in a client's building. Using a written checklist of minimum standards, Edie eliminates one applicant because he's been employed at his current job for less than a year, and another because she declared bankruptcy less than five years ago. What is the source (or the most likely source) of the minimum standards that Edie is applying?
Group of answer choices
They were probably set by Edie herself, perhaps in consultation with the client
They were probably imposed by the client's mortgage lender, as a condition for financing the purchase of the building
They probably come from the state's real estate license law, which regulates the business practices of property managers
They were established by federal regulations, to help prevent housing discrimination
Flag question: Question 44Question 441 pts
Eileen is a professional property manager. She currently works as a full-time employee for a corporation, managing the office building that the corporation owns and occupies as its main business location. In this capacity, Eileen would be referred to as a/an:
Group of answer choices
institutional manager
comptroller
facilities manager
asset manager
Flag question: Question 45Question 451 pts
For an office building, the property manager's accounting and reports to the owner should usually:
Group of answer choices
treat overdue pass-through charges as passive losses
include CAM charges and other pass-through charges in the rent figure rather than listing them separately
show separate figures for CAM charges and other pass-through charges as well as rent figures
list only pass-through charges, since the base rent and CAM charges are already known
Flag question: Question 46Question 461 pts
From a client's point of view, setting a property manager's compensation as a percentage of the property's gross income has this advantage:
Group of answer choices
it gives the manager a direct incentive to increase the property's income
the client won't have to pay the manager for any months in which the property has an operating deficit
the manager's compensation will be reduced in a month when operating expenses exceed the budgeted amount
the manager's compensation will be reduced by an appropriate bad debt/vacancy factor
Flag question: Question 47Question 471 pts
Hal is preparing an annual operating budget for a 30-unit apartment complex. In calculating the property's potential gross income, Hal will probably:
Group of answer choices
use market rents, except for current vacancies
use contract rents, except for current vacancies
subtract contract rents from market rents
subtract market rents from contract rents
Flag question: Question 48Question 481 pts
How high a vacancy rate is acceptable for a managed property depends on:
Group of answer choices
the type of property and the owner's goals
supply and demand in the submarket
general economic conditions
All of the above
Flag question: Question 49Question 491 pts
How many days a residential landlord or property manager is allowed for fixing a particular type of maintenance problem is most likely to be determined by:
Group of answer choices
the lease or rental agreement
the management agreement
state and/or local landlord-tenant laws
the Americans with Disabilities Act
Flag question: Question 50Question 501 pts
In a real estate market, a period of prosperity is likely to lead to:
Group of answer choices
overbuilding
diversification
price stagnation
negative cash flow
Flag question: Question 51Question 511 pts
In an office building, the building standards:
Group of answer choices
dictate uniform construction materials and workmanship for build-out work
specify the types of activities that tenants and visitors are and are not allowed to engage in on the premises
require tenants to leave the leased space in turnkey condition at the end of the lease
should be updated at least every three years, and more frequently if possible
Flag question: Question 52Question 521 pts
In most states, a property manager is legally required to keep tenants' security deposits:
Group of answer choices
separate from trust funds
separate from non-trust funds
in an account that's in the name of the property owner (the landlord) rather than the name of the property manager
in a pooled interest-bearing account, with interest paid to the state treasury
Flag question: Question 53Question 531 pts
In property management, the term "footloose" is applied to:
Group of answer choices
residential tenants under 30 who don't have children yet
retail outlets located outside the central business district
commercial tenants that have moved much more frequently than is typical for the type of business in question
industrial businesses that don't need to choose their location based on utility costs or proximity to resources or transportation points
Flag question: Question 54Question 541 pts
In regard to an insurance policy covering managed property, the insurable interest requirement generally means that:
Group of answer choices
the policy must be in the name of the client (the property owner), not the property manager
it's better to have the policy issued in the property manager's name rather than the owner's name
the insurance premiums must be paid by the property owner, not the property manager
the policy must name not only the property owner, but also the property manager and the tenant(s)
Flag question: Question 55Question 551 pts
In the income approach to property valuation, an appraiser translates the property's net operating income into an estimate of market value by using a/an:
Group of answer choices
income ratio
cap rate
value factor
bad debt/vacancy factor
Flag question: Question 56Question 561 pts
In the market analysis for a management plan, the property manager must:
Group of answer choices
determine the relevant submarket
allow the client to specify the relevant submarket
use the submarket categories established by IREM for MSAs with populations over 100,000
define the submarket in compliance with IRS accounting rules
Flag question: Question 57Question 571 pts
Investors are advised to diversify their investments because:
Group of answer choices
it will allow them to draw on cash reserves to offset investment losses
only a diverse mix of investments can be considered truly liquid
a poor yield from one type of investment may be offset by good yields from other types
diversified investments are generally tax-deductible
Flag question: Question 58Question 581 pts
Jeff has new tenants in the residential buildings he manages fill out a walk-through checklist. This form:
Group of answer choices
limits Jeff's liability (and his client's) regarding issues affecting habitability
must be filled out while Jeff or an assistant is present, or it will not be legally binding
should be signed by the tenant, and any problems noted should be verified by Jeff or an assistant
should not be used in determining how much of the tenant's security deposit to refund at the end of the tenancy
Flag question: Question 59Question 591 pts
Life-cycle costing refers to:
Group of answer choices
taking into account costs and potential savings over time (not just the initial cost) when deciding whether to replace or upgrade building equipment
recording expenditures on maintenance as they accrue rather than when they are incurred
treating expenditures on preventive maintenance as income rather than operating expenses
adjusting the percentage of gross income that will be spent on maintenance to take into account both the actual age and the remaining useful life of the building
Flag question: Question 60Question 601 pts
Most industrial leases contain an escalation clause, because:
Group of answer choices
the term of an industrial lease is usually at least ten years, and frequently longer
market rents are more volatile for industrial property than for other types
the property manager's compensation is tied to the tenant's gross sales
industrial properties are more likely to have environmental issues than other types of commercial properties
Flag question: Question 61Question 611 pts
On-site staff that a property manager hires for an office building will be:
Group of answer choices
employees of the property owner, not the property manager
employees of the property manager (or her management firm), but treated as employees of the property owner for tax purposes
independent contractors rather than employees
paid out of the building's operating funds
Flag question: Question 62Question 621 pts
One of the properties that Terry manages had an operating deficit this month. How should he deal with this?
Group of answer choices
Terry is legally required to notify the client within 24 hours
Terry should take the steps specified in the management agreement
It's customary to cover a deficit by deducting the amount of the shortfall from the manager's compensation
The usual practice is to cover the deficit using a credit card, then roll the charge over into the next fiscal year
Flag question: Question 63Question 631 pts
Pat manages 16 properties owned by ten different clients, all of whom are individual investor-owners. She sets her own schedule, juggling her tasks for all of the properties, and makes management decisions primarily using her own judgment. For tax purposes and various other legal purposes, Pat's status in relation to her clients is almost certainly that of:
Group of answer choices
a trustee
an employee
a gratuitous agent
an independent contractor
Flag question: Question 64Question 641 pts
Paying current tenants a fee as an incentive for referring new tenants:
Group of answer choices
is one of the best ways to find prospects that will fit in
is unlikely to be cost-effective unless the property is very unusual in some way
violates the Fair Housing Act (if the rental property is residential)
is illegal in many states
Flag question: Question 65Question 651 pts
Power washing the exterior of a building is an example of:
Group of answer choices
corrective maintenance
preventive maintenance
custodial maintenance
deferred maintenance
Flag question: Question 66Question 661 pts
Roger and Marianne are property managers who work for ABC Property Management. Ginny and Louis are property managers who work for XYZ Property Management. Which of the following scenarios describes an antitrust violation?
Group of answer choices
ABC assigns Roger to work exclusively in the West neighborhood and Marianne to work exclusively in the East neighborhood
ABC decides to focus only on high-end properties in the West neighborhood
ABC and XYZ agree that ABC will focus on the West neighborhood and XYZ will focus on the East neighborhood
XYZ assigns both Ginny and Louis to focus on high-end properties in the East neighborhood
Flag question: Question 67Question 671 pts
Saving the client money is one important reason why a property manager should:
Group of answer choices
encourage tenants to report maintenance issues promptly
respond only to complaints that have been submitted in writing
wait at least three days before responding to non-emergency complaints, which frequently solve themselves
handle complaints in a way that will keep tenants' maintenance expectations low
Flag question: Question 68Question 681 pts
Shell space is:
Group of answer choices
unfinished commercial space, ready for a tenant's build-out
partially enclosed retail space in the center of a large mall
the per-floor square footage of an office building, minus areas taken up by stairwells, elevator shafts, ductwork, and other equipment necessary to the functioning of the building
None of the above
Flag question: Question 69Question 691 pts
State law and/or the management agreement may require a property manager to be covered by an E&O policy. This type of policy is also called:
Group of answer choices
fidelity bonding
professional liability insurance
commercial general liability insurance
all perils insurance
Flag question: Question 70Question 701 pts
Subsidized housing:
Group of answer choices
may be either public housing or government-assisted housing
is usually housing for the elderly
generally must be managed by a licensed community association manager
All of the above
Flag question: Question 71Question 711 pts
The Building Owners and Managers Association (BOMA) developed the widely used system of classifying office buildings as Class A, B, or C properties. BOMA:
Group of answer choices
publishes annual ratings for all the major office buildings located in the CBD of a metropolitan area
has standardized the ratings so that a Class B building in one market will be very similar to Class B buildings across the country
does not recommend publishing a classification rating for an individual property
no longer uses the A, B, C classification system itself and discourages others from using it
Flag question: Question 72Question 721 pts
The Patriot Act effectively requires a property manager to:
Group of answer choices
check a prospective tenant's name against the SDN list
check a prospective client's name against the SDN list
decline to work for or lease to anyone whose name appears on the SDN list
All of the above
Flag question: Question 73Question 731 pts
The central aim that guides a property manager's work, no matter what context the manager works in, is managing the property in order to:
Group of answer choices
generate the greatest net income for the owners
increase the property's value as much as possible
ensure that the property reaches its highest and best use
achieve the owners' goals for the property
Flag question: Question 74Question 741 pts
The consideration of tenant mix in leasing is most important for:
Group of answer choices
residential property
office property
retail property
industrial property
Flag question: Question 75Question 751 pts
The federal Fair Labor Standards Act sets rules concerning:
Group of answer choices
minimum wage and overtime pay
vacation and sick leave
notice of termination
workplace safety
Flag question: Question 76Question 761 pts
The federal income tax return for the investor-owner of a commercial property would probably show a tax deduction for:
Group of answer choices
capital expenditures
the initial basis
passive income
depreciation of the building(s)
Flag question: Question 77Question 771 pts
The implied covenant of quiet enjoyment:
Group of answer choices
applies to residential tenancies but not commercial tenancies
applies to commercial tenancies but not residential tenancies
must be expressly included in any written lease
applies to a tenancy even if it is not expressly stated in the lease
Flag question: Question 78Question 781 pts
The owner of an apartment building is legally required to allow a disabled tenant to make reasonable modifications to his unit, at the tenant's expense. This is required by:
Group of answer choices
the federal Fair Housing Act
the Americans with Disabilities Act
Both a) and b)
Neither a) nor b); this is a requirement of state law, not federal law
Flag question: Question 79Question 791 pts
The tenant who's moving out has kept the unit in decent shape, except that at some point she badly scorched the kitchen countertop with a hot pan. The countertop was in good condition when the tenant moved in a year ago, but it will have to be replaced before the unit can be rented again. Can the property manager make a deduction from the tenant's security deposit because of the scorched countertop?
Group of answer choices
This counts as normal wear and tear, so a deduction is not allowed
This does not affect the habitability of the unit, so a deduction is not allowed
Under the "useful life" rule, it would have been necessary to replace the countertop anyway, so a deduction is not allowed
This is damage, not normal wear and tear, so a deduction is justified
Flag question: Question 80Question 801 pts
The tenants in a shopping center are typically required to:
Group of answer choices
advertise their own businesses, but not to participate in marketing the shopping center
make monthly contributions to the shopping center's marketing fund based on their leased square footage
pay for marketing the shopping center as part of their CAM charges
join the merchant's association and make an annual contribution to marketing costs based on their gross sales for the previous year
Flag question: Question 81Question 811 pts
The term "qualification package" refers to:
Group of answer choices
a summary of the property manager's credentials and experience, with supporting documents, included in a management proposal
the requirements for membership in a professional association such as BOMA or IREM, or for a particular designation conferred by such an association
orientation materials provided to new tenants in large residential complexes, typically including information about the property's amenities, a list of neighborhood resources, and an appropriate welcome gift
a prospective commercial tenant's rental application and supporting documents, such as profit and loss statements and income tax returns
Flag question: Question 82Question 821 pts
There are many differences between residential property and commercial property that affect their management. All of the following statements about the differences are correct, except:
Group of answer choices
residential leases generally have longer terms
residential properties are more likely to require round-the-clock management
residential property managers (and/or their staff) typically have to spend a greater proportion of their time on marketing and leasing
residential tenancies are generally subject to many more landlord-tenant law requirements
Flag question: Question 83Question 831 pts
There are several ways a property manager may try to increase a property's NOI without raising the rents, including:
Group of answer choices
improving the occupancy rate
making a larger percentage of each tenant's security deposit nonrefundable
cutting back on capital expenditures that are not immediately necessary
arranging for the owner to refinance the property's mortgage
Flag question: Question 84Question 841 pts
To evaluate the effectiveness of marketing efforts, a property manager is likely to use:
Group of answer choices
traffic reports
direct solicitation
hit tickets
projection rates
Flag question: Question 85Question 851 pts
To woo industrial businesses to their area, governments may use:
Group of answer choices
tax relief
relaxed legal requirements
financing assistance
All of the above
Flag question: Question 86Question 861 pts
Under CERCLA, the federal toxic waste cleanup law, the current owner of a contaminated property can be held liable for cleanup costs:
Group of answer choices
only if she directly caused the contamination
only if she modified the property in some way that caused a foreseeable release of contaminants onto neighboring property
if she knew about or should have known about the contamination when the property was acquired
if she leases the property to another party without providing a contamination disclosure report
Flag question: Question 87Question 871 pts
Under the FCRA, a property manager must:
Group of answer choices
obtain a rental applicant's credit report from at least three different credit bureaus
provide all residential rental applicants with a booklet explaining their rights under the law
provide a written notice to a residential or commercial rental applicant rejected based on a credit report
run credit checks on all rental applicants, both residential and commercial
Flag question: Question 88Question 881 pts
Unlimited liability means:
Group of answer choices
the liability of the investors who own a property may exceed the value of the property itself
any judgments entered against the business or the individual investors are not subject to the federal liability cap
the personal assets of a business owner or investor can be reached by creditors of the business
the debts and obligations of the business may exceed the value of the investment property owned
Flag question: Question 89Question 891 pts
When a property manager or leasing agent discusses office space with a prospective tenant, the first issue that has to be addressed is usually:
Group of answer choices
pass-through charges
the size and configuration of the available space
the tenant improvement allowance
common area maintenance
Flag question: Question 90Question 901 pts
When marketing property for lease, a property manager decides to include the amount of the rent and other cost information in the advertising. This is likely to:
Group of answer choices
help prevent wasted time and effort for the manager
trigger Truth in Lending Act requirements
put off well-to-do and older prospects, who tend to feel it's in poor taste to discuss money matters publicly
discourage many qualified prospects who would have submitted an application if they had come to see the property
Flag question: Question 91Question 911 pts
Which of the following is most likely to be the absorption rate for an area?
Group of answer choices
8 months
8%
8 to 1
80,000 square feet
Flag question: Question 92Question 921 pts
Which of the following is or are counted as operating expenses for a managed property?
Group of answer choices
Debt service
Management fees
Capital expenditures
All of the above
Flag question: Question 93Question 931 pts
Which of the following would be most likely to enter into a sale-leaseback agreement or a ground lease?
Group of answer choices
The marketing director for a regional shopping center
An industrial business that needs to construct a special purpose building
A tenant in an office building who needs to expand into additional space
A condominium owner who can't rent out his unit without the prior approval of the community association
Flag question: Question 94Question 941 pts
Which of the following disclosure laws is a federal statute that applies throughout the U.S.?
Group of answer choices
A law that requires residential landlords or property managers to make disclosures to tenants regarding lead-based paint in some cases
A law that requires residential landlords or property managers to disclose that a registered sex offender lives in the vicinity
A law that requires landlords or property managers to have the property tested for pests and provide inspection reports to prospective tenants
A law that requires a property manager to disclose to the client any payment or other financial benefit received through her work for the client
Flag question: Question 95Question 951 pts
Which of the following statements about the Americans with Disabilities Act is correct?
Group of answer choices
It applies to office property, but not to retail property
It applies to retail property, but not to office property
When retail property is leased, both the landlord and the tenant are responsible for ADA compliance
ADA compliance is solely the landlord's responsibility; a tenant cannot be sued for violations
Flag question: Question 96Question 961 pts
Which of the following would be the best starting point for an example illustrating the concept of leverage?
Group of answer choices
Alison purchased a rental property by making a 15% downpayment; when she sold the property, it had increased in value by 6%
Jerry's rental property decreased in value by 2% during his period of ownership
The annual operating expenses for Carmen's rental property came to 63% of the gross income
Ralph receives a monthly income of approximately $1,100 from his rental property
Flag question: Question 97Question 971 pts
Which of these are not commonly factors in creating the boundaries of a neighborhood?
Group of answer choices
Bodies of water
Zoning restrictions
Government survey maps
Ethnic or racial identity and discrimination
Flag question: Question 98Question 981 pts
Which of these statements about hiring contractors is correct?
Group of answer choices
It's only appropriate to use contractors for maintenance work; other tasks should generally be performed by employees
Contractors should be hired and paid by the property owner, not the property manager, whenever possible
Contractors cost more per hour than employees, but they require less administrative work and do not receive benefits
A property manager should purchase a fidelity bond to cover each contractor hired
Flag question: Question 99Question 991 pts
Why does the liquidity of an investment matter?
Group of answer choices
Less liquid investments have consistently lower yields than more liquid investments
The investor might want the invested funds for a different investment opportunity or for emergency expenses
The number of liquid investments that an investor can hold at one time is limited by law
Federal deposit insurance does not cover liquid investments
Flag question: Question 100Question 1001 pts
With an operating expense escalation clause, the property manager:
Group of answer choices
must base increases on a widely accepted standard, such as the Consumer Price Index
must wait until the actual operating expense figures are known before charging tenants for increases
may use estimates of operating expense increases, then make adjustments later when the actual expenses are known
may use estimates, but cannot charge tenants an additional amount if the actual expenses turn out to be higher than the estimates
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