Agency and License Law Practice Question
Question
A client asks whether a fact should be disclosed for the North Carolina Real Estate Broker Exam involving commission payment and material facts and due diligence practice. Which response best applies the rule? (Item 104)
Answer choices
- A. The rule applies only to commercial transactions and never to residential transactions.
- B. Client funds may be mixed with business funds if the broker reconciles the account later.
- C. The issue can be ignored if the parties want to close quickly.
- D. Recognize that affiliated licensees are usually paid through their broker in a way that fits North Carolina exam practice.
Correct Answer
D. Recognize that affiliated licensees are usually paid through their broker in a way that fits North Carolina exam practice.
Explanation
The correct answer is D because commission payment requires candidates to recognize that affiliated licensees are usually paid through their broker. The North Carolina 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: hard
- Domain: Agency and License Law
- Objective: commission payment