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Humber College Exam 4: Invigilated Theory Sample Questions:

1. Which of the following statements regarding heavy industrial use and light industrial use is correct?

A) Heavy industrial use usually results in less traffic in and out of the heavy industrial zone.
B) Heavy industrial use can produce more pollution than other commercial activities.
C) Clay production is an example of light industrial use.
D) Light industrial use usually results in more noise and heavier traffic.

2. The cost approach is one method of real estate evaluation that an appraiser may use to estimate the value of a commercial property. Which of the following is NOT an accurate statement regarding the cost approach?

A) The cost approach is useful for the appraisal of property types for which sales and income data are scarce, such as industrial and special-purpose properties.
B) The cost approach is preferred for older construction properties, as calculating depreciation on them is fairly straightforward.
C) The cost approach is preferred for newer construction properties, as the appraiser would not need to make a subjective estimation of the accrued depreciation of the building.
D) The cost approach is typically used to appraise income-generating properties.

3. A developer has completed the construction of a new commercial condominium project that is readyfor occupancy by the buyers. The condominium should be registered within approximately six months. Which of the following accurately describes a responsibility of the developer?

A) The developer will be responsible for registering the declaration and description and creating the plan and vision for the property.
B) The developer will be responsible for calling a general meeting within 21 days to appoint a new board of directors.
C) The developer will be responsible for much of the day-to-day management of the condominium corporation's affairs after the turnover meeting.
D) The developer will be responsible for overseeing the business affairs of the condominium corporation after the turnover meeting.

4. A buyer looking for an industrial property tells the salesperson that on-site trailer storage space is an important feature. What is a reason on-site trailer storage might be important for the buyer's industrial business?

A) Businesses need to transport materials to and from the site.
B) Incoming trucks could have difficulty if there is a lack of on-site trailer storage.
C) Outgoing trucks could have difficulty if there is a lack of on-site trailer storage.
D) Some trucks may need to park on the property overnight.

5. Finish the sentence: When a commercial tenant enters an agreement to lease, the covenant to pay rent specifies that the tenant:

A) Agrees to pay additional rent for a gross lease.
B) Cannot pay rent to the property manager and must pay directly to the property owner.
C) Agrees to pay any percentage rent a landlord demands, regardless of sales revenue.
D) Cannot withhold rental payments even if the landlord does not comply with their obligations under the lease.

Solutions: