Chapter 4

All of the following activities are exempt from the requirement to provide disclosures under the

Brokerage Relationship Disclosure
Act, EXCEPT:

• 1. Sales staff at a new development center

  2. 

• 1. Showing property to a party that is not being represented

  2. 

• 2. A bona fide open house or model home showing that does not involve eliciting confidential information, the execution of a contractual offer or an agreement for representation, or negotiations concerning price terms, or conditions of a potential sale

  3. 

• 2. Responding to general factual questions from a potential buyer or seller concerning properties that have been advertised for sale

As an agent, a broker is employed by and acts on behalf of whom?

1. 

• A buyer

• 1. A seller

  2. 

• A customer

  1. 

• A principal

In which of the following situations does a general agency relationship exist?

1. 

• When a broker is employed to market a property

• 1. When a sales associate is working with a customer

• When a sales associate is employed by a broker

• When a broker is employed by a buyer

Broker Joan just received an ora offer to purchase a listed propery.

No earnest money accompanied the oral offer. Which of the following statements is correct?

• Joan must present the offer

• Joan should not present the offer since no earnest money deposit was received.

• Joan must advise the customer that an earnest money deposit is required to make an offer valid.

• Joan should reject the offer on behalf of the seller

Who owes fiduciary duties in a single agency relationship?

• The broker only

  1. 

• 2. The principal only

  3. 

• 2. Both parties

  3. 

• Neither party

Which of the following statements best describes a transaction broker?

• Which of the following statements best describes a transaction broker?

  1. A transaction broker is an agent of both parties.

• 1. A transaction broker has fiduciary duties to the seller.

• 1. A transaction broker has fiduciary duties to the buyer.

• A transaction broker may provide limited representation to both parties.

An agent failed to advise a principal regarding the value of the owner's property prior to accepting a listing.
Which fiduciary duty did the agent breach?

• Loyalty

• 1. Disclosure

• Accounting

• Obedience

What is an agent required to do in an agency relationship?

• 1. Obtain the highest price possible.

• Attempt to obtain the most favorable price and terms on behalf of the principal.

• Obtain the lowest price possible.

• Negotiate the transaction to receive the highest possible commission.

When can an agent disclose confidential or harmful information about a principal?

• At any time

• During the fiduciary relationship period only

• After the transaction is completed and the fiduciary relationship is over

• 2. Never

Each of the following is contained in the definition of a residential transaction, EXCEPT:

• Unimproved property intended for four units or fewer

• Agricultural properties of ten acres or less

• Leases with options to purchase all or a portion of improved property of four or fewer residential units

• Dispositions of business interests involving property of five or more residential units