Question 1

A stated annual interest rate of 9.25 % (with semi-annual compounding) is equivalent to a monthly compounding rate of:

Question 1 options:

1)

0.377 %.

2)

0.756 %.

3)

1.400 %.

4)

7.708

2). If a mortgage has a principal of $ 200 000, an annual interest rate of 8 % (with semi-annual compounding) and an amortization period of 25 years, each monthly payment should be equal to:

Question 2 options:

1)

$1 052.04

2)	$16 000.00

3)

$8 348.35

4)

$1 526.43

Question 3 When appraising a house with unique features, the direct market comparison (DMC) approach is more practical than the cost approach.Question 3 options:

1) True

2) False

Save Question 4 The direct market comparison (DMC) approach is limited in the sense that there must be available data pertaining to the sale of comparable homes in the recent past.Question 4 options:

1) True

2) False

Save Question 5 The analysis of the "buy" versus "rent" decision consists of comparing the cash-flow value of each alternative.Question 5 options:

1) True

2) False

Save Question 6 The utilitarian and enjoyment values associated with home ownership indirectly affect house prices.Question 6 options:

1) True

2) False

Save Question 7 To calculate the after-tax rate of return on a house investment, one must deduct the total expected capital gain from the total imputed rental gain.Question 7 options:

1) True

2) False

Save Question 8 Canadian financial institutions are usually willing to lend more than 75 % of the appraised value of the house without insurance, thus the minimum down payment can be less than 25 % of the appraised value of the house.Question 8 options:

1) True

2) False

Save Question 9 A vendor-take-back (VTB) mortgage enables the buyer to acquire a more expensive house than that which a bank would normally allow.Question 9 options:

1) True

2) False

Save Question 10 The term of a given mortgage is three years with a fixed interest rate of 7.5%. At the end of the second year the market interest rate increases to 8.0%. The amount of the monthly mortgage payments will be increased for year three.Question 10 options:

1) True

2) False