Real Estate 101 - Real Estate Principles » Fall 2021 » Chapter 6 Quiz

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Question #1
A provision in a contract stating the purchase depends on the buyer qualifying for a loan is called a:
A.   all answers are correct.
B.   covenant.
C.   “subject to” provision or contingency clause.
D.   loan back-out clause.
Question #2
When an existing contract is replaced with an entirely new contract, it is called:
A.   rescission.
B.   assignment.
C.   subordination.
D.   novation.
Question #3
Which of the following is a classification of a contract?
A.   Valid
B.   Unenforceable
C.   Voidable
D.   All answers are correct
Question #4
An assignment:
A.   is only for personal service.
B.   transfers only liability.
C.   transfers a person’s right in a contract.
D.   is a new contract.
Question #5
Which of the following is FALSE concerning purchase agreement contracts?
A.   They must be accompanied by a deposit of money or other items of value.
B.   An agent must give a copy to both buyer and seller.
C.   Promissory notes and post-dated checks are never acceptable as consideration.
D.   When acceptance is communicated to the buyer, it becomes a binding contract.
Question #6
Which of the following is FALSE concerning options?
A.   They are granted in exchange for money.
B.   They have specific time periods.
C.   They can be revoked at any time by the optioner (seller), without penalty.
D.   They have specific terms.
Question #7
Consideration can best be described as:
A.   anything of value.
B.   money paid in a contract.
C.   not necessary in a valid contract.
D.   good will.
Question #8
A remedy for breach can be:
A.   all answers are correct.
B.   an action for damages.
C.   a unilateral rescission.
D.   an acceptance of breach.
Question #9
What is always true about a counter offer?
A.   It terminates the previous offer.
B.   The previous offer is still valid.
C.   It is made by the seller.
D.   It is made by the buyer.
Question #10
The current award for liquidated damages on a purchase agreement form is a maximum of:
A.   3% of the home purchase price.
B.   33% of the home purchase price.
C.   133% of the home purchase price.
D.   13% of the home purchase price.
Question #11
A signed written contract takes precedence over oral agreements or prior written agreements based on:
A.   the parol evidence rule.
B.   the statute of frauds.
C.   English common law.
D.   the performance rule.
Question #12
If one of the parties doesn’t go through with a contract (nonperformance), it is called a(n):
A.   assignment.
B.   operation of law.
C.   consideration.
D.   breach.
Question #13
A written contract between two parties is:
A.   express and bilateral.
B.   implied and unilateral.
C.   express and unilateral.
D.   implied and bilateral.
Question #14
Any contract that can’t be performed within one year from the date of signing:
A.   is an example of duress.
B.   is illegal.
C.   must be in writing.
D.   is a failure to perform.
Question #15
Which of the following forms are part of CAR's® "Purchase Agreement Package"?
A.   All answers are correct
B.   Wire Fraud and Electronic Funds Transfer Advisory (WFA)
C.   Buyer's Inspection Advisory (BIA)
D.   Disclosure Regarding Real Estate Agency Relationship (AD)
Question #16
Which of the following is used to change the original terms of the purchase agreement?
A.   Covenant form
B.   Counter offer form
C.   Contingency form
D.   Substitution form
Question #17
An agreement that is made either verbally or in writing is known as a(n):
A.   express contract.
B.   implied contract.
C.   mutual consent.
D.   all of the above.
Question #18
If a contract is said to be “executory,” it:
A.   is court ordered.
B.   has not yet been performed.
C.   has not yet been signed.
D.   has been discharged or performed.
Question #19
Which of the following is NOT considered a basic element of a contract?
A.   capacity
B.   consideration
C.   enforcement
D.   Mutual consent

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