Agency and License Law Practice Question
Question
A supervising broker is reviewing a transaction file for the North Carolina Real Estate Broker Exam involving disciplinary grounds and North Carolina Real Estate Commission. Which statement is most accurate for exam purposes? (Item 70)
Answer choices
- A. Local custom controls even when a statute, regulation, contract, or disclosure rule applies.
- B. Recognize fraud, misrepresentation, trust fund violations, and unlicensed activity as discipline risks in a way that fits North Carolina exam practice.
- C. The requirement matters only when the buyer obtains institutional financing.
- D. The affiliated licensee may handle the matter independently without broker responsibility.
Correct Answer
B. Recognize fraud, misrepresentation, trust fund violations, and unlicensed activity as discipline risks in a way that fits North Carolina exam practice.
Explanation
The correct answer is B because disciplinary grounds requires candidates to recognize fraud, misrepresentation, trust fund violations, and unlicensed activity as discipline risks. 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: medium
- Domain: Agency and License Law
- Objective: disciplinary grounds