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

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