Valuation and Financing Practice Question
Question
A salesperson is explaining a concept to a client involving market value. Which response best protects the client and keeps the transaction compliant? (Item 21)
Answer choices
- A. Identify market value as the most probable price under normal conditions.
- B. It requires the licensee to favor the other party over the licensee’s own client.
- C. It is primarily a tax rule with no effect on brokerage practice.
- D. It removes the need for written disclosure if the licensee believes the client already knows.
Correct Answer
A. Identify market value as the most probable price under normal conditions.
Explanation
The correct answer is A because market value requires candidates to identify market value as the most probable price under normal conditions. 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: market value