Agency and License Law Practice Question
Question
A supervising broker is reviewing a transaction file for the Massachusetts Real Estate Salesperson Exam involving conversion and broker-salesperson supervision. Which statement is the best answer? (Item 31)
Answer choices
- A. The affiliated licensee may handle the matter independently without broker responsibility.
- B. Local custom controls even when a statute, regulation, contract, or disclosure rule applies.
- C. Recognize unauthorized use of client money as serious misconduct in a way that fits Massachusetts exam practice.
- D. The requirement matters only when the buyer obtains institutional financing.
Correct Answer
C. Recognize unauthorized use of client money as serious misconduct in a way that fits Massachusetts exam practice.
Explanation
The correct answer is C because conversion requires candidates to recognize unauthorized use of client money as serious misconduct. The Massachusetts 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: medium
- Domain: Agency and License Law
- Objective: conversion