Sample Questions

Following are the sample Questions for Multiple Choice:

1) In regards to the Multiple Listing Service, select the correct statement.
i) The Real Estate Board regulates the day-to-day procedures for MLS.
ii) The Ontario Real Estate Association promotes the effective use of the service.
iii) The Canadian Real Estate Association oversees the use of the logo and protects its position as owner of the trademark.
a) i) is correct only.
b) i) and ii) are correct only.
c) i), ii) and iii) are correct only.
d) None of the statements are correct.

2) Metes and bounds is a system of written land descriptions. Which of the following is true?
a) All boundary lines are described by the use of lot numbers
b) All boundary lines are described by the use of terminal points and angles
c) All boundary lines are described as whole lots or fractional parts of lots
d) None of the above

3) Which of the following statements is NOT correct regarding Clause 17 on the Agreement of Purchase & Sale (Residency Clause)
(a) The clause is directed to non-citizens of Canada
(b) The clause permits the Buyer to receive a credit on closing for the buyer’s tax obligation under the
Income Tax Act
(c) Is not required if the Seller provides a statutory declaration that they are not a non-resident
(d) Is particularly important in recreational areas where cottages are located

4) Which of the following is NOT a true statement under the current regulatory framework?
a) The Real Estate and Business Brokers Act allows for limited exemptions for auctioneers and lawyers to trade in real estate.
b) As part of the responsibilities of the Real Estate  Council of Ontario ,the registrar of Real Estate and Business Brokers qualifies brokers and salespeople and regulates their activities.
c) There is no distinction made between real estate brokers and business brokers for purposes of the Real Estate and Business Brokers Act.
d) The Real Estate and Business Brokers Act applies only to the sale of real estate and not to leasing.

5) Which of the following statements are true?
i) Land is described in a precise manner so that one piece of land cannot be mistaken for another.
ii) A description such as the lot with two mature maples or 43 Main Street is not sufficient as a land description in a current legal document.
iii) When originally laid out, county boundaries might follow natural boundaries, e.g., a river or lake, but most often were straight lines through the bush.
iv) A concession is normally 66 feet in width.

1. i., ii, and iv.
2. i., ii. and iii.
3. ii. and iii
4. i. and ii.

6) A condition subsequent is best used when:
a) The offer is conditional on a severance, but you are sure the severance will be granted and the closing
isn’t for 6 months
b) The offer is conditional on arranging financing with a specific lender and your Buyer has received a preapproval
from that lender
c) A Seller wants to accept a second offer and they are sure the first offer they accepted will not fulfill or
waive their conditions
d) None of the above

7) If site values have been decreasing by 1% per month and a comparable sale for $140000 four months ago is judged 3% superior to the subject property, what associated adjustments should be applied to that comparable in arriving at an adjusted price.
a) ($5400) and ($4000)
b) $1400 and $4200
c) ($5600) and ($4200)
d) $5600 and $4000

8) Builder Anderson is contemplating the commercial property purchase with a gross income of $342,000 with expenses of $283,500 and there is a vacancy loss of 3% with the cap rate of 10.5%. What will be the value of this property? The structure contains 12,350 square feet. How much should he pay per square foot and per square metre?
a) $459,000, $39.10 per square feet and $340 per square meter
b) $428,459, $35.50 per square feet and $352 per square meter
c) $459,429, $37.20 per square feet and $400 per square meter
d) $459,000, $44.10 per square feet and $404 per square meter

9) Buyer Peter is considering a mortgage at 8% per annum, calculated monthly not in advance. According to the interest act, what is the maximum effective rate that can be charged per annum?
a) 3.28%
b) 1.33%
c) 1.80%
d) 3.90%

10) 46. When completing the Agreement of Purchase & Sale-Commercial:
a) The Commission Trust Agreement is always signed to protect our commission
b) A disclosure must be made in the offer if both buyer & seller are being represented by your company
c) Spousal Consent is never involved because we are selling commercial, not a single family home
d) The Seller's signature also authorizes the Seller's lawyer to pay directly to the Listing Brokerage the unpaid balance of the commission.

11) .  If a tenant leases 2,000sf and the base rent is 10/sf with additional rent of $2.50/sf for the entire term of the lease, the amount of the first & last month's deposit should be:
a) $3,333.33
b) $4,166.67
c) $3,500       
d) $4,375

12) A couple lives in Florida from October 1st to May 30th. They are listing their house for sale. Which of the following statement is true.?
a) Seller’s lawyer would normally give a personal undertaking to pay any tax liability out of the sale.
b) They are non-residents. Buyer will be liable for their tax unless either the seller is cleared by  CRA or buyer remits 25% of purchase price to CRA.
c) Buyer can rely on the seller’s assurance that this is their primary residence.
d) They assure you they are Canadian citizens so it is okay. CRA will able to collect from them.