Principles, Property, and Land Use Practice Question

Question

A supervising broker is reviewing a transaction file for the Georgia Real Estate Salesperson Exam involving cost approach and brokerage relationship disclosure. Which statement is most accurate for exam purposes? (Item 157)

Answer choices

1. A. Combine land value with replacement cost less depreciation in a way that fits Georgia exam practice.
2. B. The issue can be ignored if the parties want to close quickly.
3. C. The rule applies only to commercial transactions and never to residential transactions.
4. D. Client funds may be mixed with business funds if the broker reconciles the account later.

Correct Answer

A. Combine land value with replacement cost less depreciation in a way that fits Georgia exam practice.

Explanation

The correct answer is A because cost approach requires candidates to combine land value with replacement cost less depreciation. The Georgia reference keeps the scenario tied to state licensing practice, while the other options rely on unsafe assumptions about oral custom, escrow, client preference, independent licensee authority, or ignoring written duties.

Question details

• Difficulty: easy
• Domain: Principles, Property, and Land Use
• Objective: cost approach

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