Chapter 9 Quiz

Question 1 of 15

1. Question

In a typical real estate transaction an agency relationship exists between the:

seller (principal) and the listing broker (agent)
seller (principal) and the buyer (agent)
seller (agent) and the buyer (principal)
buyer (principal) and the listing broker (agent)

Question 2 of 15

2. Question

To lessen confusion among buyers and sellers regarding agency representation, all states have enacted laws that require an agent to:

disclose to the parties who the agent represents in the transaction
act as an agent to both parties in residential transactions
be licensed as either a seller’s agent or a buyer’s agent
act as a seller’s agent if the agent belongs to a multiple listing service

Question 3 of 15

3. Question

A potential buyer who deals with a seller through a listing agent is known as a:

client
customer
nonagent
principal

Question 4 of 15

4. Question

The most common method for creating a seller agency relationship is:

payment of a commission
a written listing agreement
submitting a listing to a multiple listing service
words or conduct by the parties indicating intent to create an agency

Question 5 of 15

5. Question

Broker Quincy represents a homeseller, Reba. Reba wants a quick sale and tells Quincy that although the listing price is $500,000, she would go as low as $450,000. Quincy tells a prospective buyer that Reba would sell for $450,000, so the buyer offers $450,000 and Reba accepts. Quincy has:

not violated his fiduciary duty, because he obtained an acceptable offer
not violated his fiduciary duty, because he acted within his implied authority
violated his fiduciary duty but without causing harm
violated his fiduciary duty by breaching the duty of loyalty

Question 6 of 15

6. Question

In an in-house sale:

the listing isn’t submitted to the MLS
the compensation must be paid from the principal directly to the broker’s salespeople
the buyer and seller are brought together by salespeople working for the same broker
all of the above

Question 7 of 15

7. Question

A dual agent must:

disclose all confidential information to both the buyer and the seller
keep each party’s negotiating position confidential
avoid giving advice to either party
submit conflicts between the buyer and the seller to arbitration

Question 8 of 15

8. Question

A licensee owes to all parties, regardless of whom the licensee represents, the duty of:

loyalty
confidentiality
stating the property’s true value
honesty and fair dealing

Question 9 of 15

9. Question

Dual agency is:

improper unless the buyer pays the agent’s commission
improper unless the buyer is a friend or relative of the agent
not improper if both agents are paid the same amount
not improper if both principals give their informed, written consent

Question 10 of 15

10. Question

A buyer’s agent is most commonly compensated by the:

buyer, through payment of a commission
seller, through a commission split
buyer, through payment of a flat fee
seller, through payment of a flat fee

Question 11 of 15

11. Question

Broker Lois listed the Mannings’ property. The Mannings told her that the roof would leak in heavy rain, but she did not tell Ned, the buyer, since he did not ask about the roof. If Ned purchases the property, discovers the leak, and then sues for damages:

he will have no recourse since it was his duty to inspect the property
Lois will be liable, but the Mannings will not be liable
the Mannings will be liable, but they may in turn recover damages from Lois
the Mannings will be liable, but Lois will not be liable

Question 12 of 15

12. Question

An agency relationship may terminate:

only if there is a termination date in the agency agreement
only if the agent has proven to be incompetent or untrustworthy
only with the agent’s written consent
with the mutual consent of the parties

Question 13 of 15

13. Question

An agent may unilaterally terminate an agency relationship through:

mutual agreement
operation of law
renunciation
revocation

Question 14 of 15

14. Question

Which of the following statements about dual agency is not true?

Inadvertent dual agency may arise in a situation where the listing broker has had a previous relationship with the buyer
Dual agency is illegal in all states
Dual agency is frowned upon because of the inherent conflicts of interest
Dual agency requires comprehensive disclosure to both parties by the agent

Question 15 of 15

15. Question

The owners of an apartment building hire a real estate broker as the property manager. If the owners later sell the building, their agency relationship with the property manager:

is automatically transferred to the new owner
terminates due to extinction of the subject matter
cannot be terminated by the former owners without liability to the property manager
continues unless terminated by the property manager

Quiz Summary

Information

Results