California Real Estate Exam Multiple Choice

California Real Estate Exam Multiple Choice Questions Latest Update 2024-2025 Actual Exam with 500+ Questions and 100% Verified Correct Answers Guaranteed A+ Approved by the Professor

"A" has been given power of attorney for the purpose of selling "B's" house. Which of the following is NOT true?

• "A" cannot sell the property if "B" has recorded a homestead on it.
• Power of attorney must be recorded for "A" to sell the property.
• Power of attorney is terminated in the event "B" is declared incompetent and unable

to enter into a legal contract.

• "A" may purchase the property, providing he/she pays a fair market value for the

home. - CORRECT ANSWER: d. "A" may purchase the property, providing he/she pays a fair market value for the home.

An attorney-in-fact cannot deed or convey the property to self. If he desires to purchase it, he/she must "give up" the power of attorney.

"Domicile" most frequently means:

• semi-circled ceiling.
• relationship of parties.
• home or residence.

d. none of above. - CORRECT ANSWER: c. home or residence.

"Gross multiplier" is used to determine value of certain types of income properties. It is

determined by:

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• dividing the gross rental income by the appraised value. b. multiplying the market

price by the capitalization rate.

• dividing the sales price by the gross monthly rental.
• multiplying the gross monthly rental by a reasonable cap rate. - CORRECT

ANSWER: c. dividing the sales price by the gross monthly rental.

Gross Rent Multiplier is a rough, quick way of converting gross rent into market value.

"Moral philosophy" best matches:

• ethnics.
• ethics.
• dedication.

d. subordination. - CORRECT ANSWER: b. ethics.

"Placement of a home on a lot" best matches:

• option.
• avulsion.
• dedication.

d. plot plan. - CORRECT ANSWER: d. plot plan.

Plot plan is planning the most advantageous place on a parcel of land for an improvement to be located.

"The right of one or more persons to possess and use something to the exclusion of

others" describes:

• discrimination.
• novation. 2 / 4

• ownership.

d. equity. - CORRECT ANSWER: c. ownership.

*A broker obtained an exclusive listing to sell a piece of property. He spent much time, money, and energy. The seller refused to allow the broker to proceed under the

agreement. The broker should:

• consider the seller's refusal a breach and sue for damages.
• consider the seller's refusal a breach and claim the amount of commission as

liquidated damages.

• ignore the seller and proceed.
• relieve seller of liability, and work on improving relationship so as to enable retaining

future business. - CORRECT ANSWER: a. consider the seller's refusal a breach and sue for damages.

When seen from a technical point of view. In reality, sometimes "d" would result in more favorable and profitable end results.

*For federal income tax purposes, a taxpayer could increase the basis of his/her residence with which of the following?

• Property taxes
• Accrued depreciation
• Addition of a patio
• None of the above, for a personal residence basis cannot be adjusted for any reason

- CORRECT ANSWER: c. Addition of a patio

Capital improvements are acceptable adjustments to basis.

*Which of the following phrases would best bind all parties to pay their debts?

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• Jointly
• Individually
• Individually and severally

d. Jointly and severally - CORRECT ANSWER: d. Jointly and severally

All parties are held responsible collectively or individually for the entire obligation.

1. A real property security endorsement is valid for:

• as long as the broker's license is valid, and it needs no further endorsement.
• multiples of 4 years.
• one year.
• the term of the broker's license to which the endorsement is affixed. - CORRECT

ANSWER: d. the term of the broker's license to which the endorsement is affixed.

• Considering the "Interstate Land Sales Full Disclosure Act," which of the following is

NOT true?

• Controls subdivisions of 25 (or more) lots, unimproved at the time of sale.
• Developer must register subdivision with Office of Inter-Land Sales Registration

(OILSR), and provide copy of "property report" to purchaser or lessee.

• Any contract to purchase or lease may be revoked by purchaser or lessee within 7

days of signing the contract.

• Violations are punishable by fines up to $50, imprisonment of up to 5 weeks, or both.
• CORRECT ANSWER: d. Violations are punishable by fines up to $50, imprisonment of

up to 5 weeks, or both.

Fines up to $5,000; imprisonment up to 5 yrs., or both.

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