Question: When an appraiser completes a residential appraisal for a lender using the sales comparison approach, the appraiser should be prepared to analyze at least _ comparable properties in order to reach a conclusion of value.

Answer Options: A. 2 B. 3 C. 4 D. 5

Answer: B. 3

Question: What is the minimum number of comparable sales typically required for a residential appraisal using the sales comparison approach?

Answer Options: A. 1 B. 2 C. 3 D. 4

Answer: C. 3

Question: Which list MOST completely identifies the properties that should be included in a competitive market analysis (CMA)?

Answer Options: A. Sold properties only B. Sold properties, expired listings, and withdrawn listings C. Active listings, properties under contract, and sold properties D. Active listings, properties under contract, sold properties, expired listings, and withdrawn properties

Answer: D. Active listings, properties under contract, sold properties, expired listings, and withdrawn properties

Question: When using the sales comparison approach, which would be MOST important when selecting comparable properties?

Answer Options: A. Properties currently for sale in the area B. Properties under contract but not yet closed C. Recently sold properties in the same market area D. Properties that were withdrawn from the market

Answer: C. Recently sold properties in the same market area

Question: When would a broker price opinion (BPO) typically be requested?

Answer Options: A. For a formal appraisal B. For a listing presentation C. For a purchase offer D. For a short sale

Answer: D. For a short sale

Question: An amenity is:

Answer Options: A. never adjusted for in an appraisal B. any feature for which there is a ready substitute in the marketplace C. any tangible or intangible feature that enhances and adds value to real estate D. always a physical, tangible feature

Answer: C. any tangible or intangible feature that enhances and adds value to real estate

Question: What is the primary purpose of a competitive market analysis (CMA)?

Answer Options: A. To replace an appraisal B. To satisfy lender requirements C. To determine the exact market value D. To provide a range of probable selling prices

Answer: D. To provide a range of probable selling prices

Question: Incurable depreciation means that the:

Answer Options: A. cost of repair exceeds the value that would be added B. deterioration cannot be fixed C. item is expected to need periodic replacement D. loss in value caused by the depreciation can be written off

Answer: A. cost of repair exceeds the value that would be added

Question: Appraiser Ian is under contract with ABC Insurance Company to provide value estimates before they underwrite an insurance policy. Ian would MOST likely need to estimate the reproduction cost instead of the replacement cost for which type of property?

Answer Options: A. Apartment building B. Historical building C. Office building D. School building

Answer: B. Historical building

Question: Determine the depreciation of a $400,000 building using the age-life method. When built, the building had an expected economic life of 120 years. Its current effective age is 90 years old.

Answer Options: A. $265,500 B. $300,000 C. $285,500 D. $270,000

Answer: B. $300,000

Question: For which property would you expect the cost approach method to be LEAST useful?

Answer Options: A. A building with historic significance B. A home with many unique features C. A home in a neighborhood with high turnover D. A school building

Answer: C. A home in a neighborhood with high turnover

Question: Which of the following would NOT suffer from depreciation?

Answer Options: A. A 2,700 sq. ft. commercial building B. An abandoned building C. A residential property used as a rental D. Unimproved land

Answer: D. Unimproved land

Question: Sue is appraising a 20-year-old bank building. Based on her research and analysis of construction quality and local conditions, she determines that the building should have an economic life of 50 years. She also concludes that the building has not been well maintained and has an effective age of 30. What is its remaining economic life?

Answer Options: A. 20 years B. 30 years C. 40 years D. 50 years

Answer: A. 20 years