Agency and License Law Practice Question
Question
A broker is correcting a new licensee’s misunderstanding for the Tennessee Affiliate Broker Exam involving license-required activity and Tennessee Real Estate Commission. Which statement is the best answer? (Item 1)
Answer choices
- A. Identify acts requiring a license when performed for compensation in a way that fits Tennessee exam practice.
- B. The rule applies only to commercial transactions and never to residential transactions.
- C. Client funds may be mixed with business funds if the broker reconciles the account later.
- D. The issue can be ignored if the parties want to close quickly.
Correct Answer
A. Identify acts requiring a license when performed for compensation in a way that fits Tennessee exam practice.
Explanation
The correct answer is A because license-required activity requires candidates to identify acts requiring a license when performed for compensation. The Tennessee 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: Agency and License Law
- Objective: license-required activity