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Humber College Exam 4: Invigilated Theory Sample Questions:

1. Sometimes, transactions do not close. When a transaction won't be completed, what should a salesperson try to do as soon as possible?

A) Conduct an analysis of why the transaction will not be carried out.
B) Terminate the transaction and disengage from it.
C) Obtain the remuneration owed.
D) Pass the transaction to the broker of record so that the broker will take care of it.

2. A salesperson is preparing to list an industrial building and wants to assess the availability and size of utilities, as these factors may prohibit a change in use for the potential buyer. Which of the following is correct?

A) If the information on the subject building's utilities is available, then a potential buyer will not put a condition in the offer.
B) The salesperson should conduct a visual inspection of the building to determine the specifications of the utilities.
C) The seller may have up-to-date documentation about the utilities but, in some situations, a third-party professional assessment is still needed.
D) If the information on the building's utilities is not available, the salesperson can determine it by finding out the specifications of the utilities of the neighbors.

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

4. When discussing economic considerations, interest rates, government policies, and infrastructure specific to industrial properties, why are investors attracted to industrial properties?

A) Good transportation and distribution corridors do not matter to industrial investors and their tenants.
B) Industrial properties have a lower capital gains tax at disposition.
C) Higher mortgage interest rates will provide a better return on investment.
D) Industrial properties have a number of large, credit-worthy tenants and long-term leases.

5. What is the best indicator of a strong office market?

A) The absorption rate, net absorption rate, and rising rental rates
B) When tenants have lots of options because of the amount of available space at favorable rates
C) Low rental rates and many concessions
D) The number of free months given to new and renewing tenants by landlords in the office marketplace

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