Real Estate Principles Practice Question
Question
A buyer and seller disagree about a closing issue in a New York real estate transaction involving valuation principles. What should the licensee understand? (Item 343)
Answer choices
- A. A verbal understanding always replaces any written requirement in a real estate transaction.
- B. The licensee should avoid documenting the issue to reduce the chance of later questions.
- C. Apply market value, substitution, contribution, depreciation, and highest and best use concepts.
- D. A licensee may give legal conclusions instead of recommending qualified legal advice when the issue is uncertain.
Correct Answer
C. Apply market value, substitution, contribution, depreciation, and highest and best use concepts.
Explanation
The correct answer is C because valuation principles requires candidates to apply market value, substitution, contribution, depreciation, and highest and best use concepts. The other options rely on unsafe assumptions about custom, oral agreement, escrow, client preference, or independent salesperson authority and do not reflect sound New York exam practice.
Question details
- Difficulty: medium
- Domain: Real Estate Principles
- Objective: valuation principles