Valuation and Financing Practice Question

Question

A buyer and seller disagree about a transaction term involving sales comparison approach. Which response best protects the client and keeps the transaction compliant? (Item 103)

Answer choices

1. A. It is valid only when the buyer pays cash and no lender is involved.
2. B. It prevents any later disclosure, even when new facts become known.
3. C. Apply comparable sales adjustments to estimate residential value.
4. D. It applies only to commercial property and never to residential transactions.

Correct Answer

C. Apply comparable sales adjustments to estimate residential value.

Explanation

The correct answer is C because sales comparison approach requires candidates to apply comparable sales adjustments to estimate residential value. The other options overstate the effect of custom, oral agreement, escrow, or independent salesperson action and do not reflect safe California exam practice.

Question details

• Difficulty: easy
• Domain: Valuation and Financing
• Objective: sales comparison approach

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