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Humber College PREX-1060A Exam Syllabus Topics:

Humber College Exam 4: Invigilated Theory Sample Questions:

1. A salesperson is discussing the advantages and disadvantages of owning commercial real estatewith their investor buyer client. Which of the following is NOT an advantage of owning commercial real estate?

A) Potential for tax sheltering possibilities for the investor is an advantage of owning commercial real estate.
B) Limited equity investment while gaining leverage through financing is an advantage of owning commercial real estate.
C) Quick turnaround time to free up capital when needed is an advantage of owning commercial real estate.
D) Potential to recover capital through refinancing is an advantage of owning commercial real estate.

2. Which of the following statements about industrial building components is correct?

A) Loading docks are only used to off-load products or raw materials.
B) Flat roofs are designed to be flat to hold water.
C) Bay depth is an important consideration when determining the layout of an industrial process.
D) Floor load refers to the weight of the building during construction.

3. A brokerage negotiates the sale of a business on behalf of a seller. Which of the following documents must the brokerage provide to the buyer?

A) A list of fixtures included in the sale
B) A list of chattels excluded in the sale
C) A statement of the assets and liabilities of the brokerage
D) A profit and loss statement for the real estate brokerage for the preceding 12 months

4. A salesperson includes a well-drafted condition in an agreement of purchase and sale for their buyer client to arrange a new first mortgage for an industrial property. The buyer later changes their mind and does not want to borrow money for the purchase. What should the buyer's salesperson use to remove the condition?

A) Mutual release
B) Waiver
C) Notice of fulfillment
D) Acknowledgment

5. An agreement of purchase and sale for an industrial building is accepted conditional on financing with the expiry date of May 14. On May 11, the bank informs the buyer the mortgage cannot be approved until May
17. The salesperson for the buyer then prepares an amendment to the agreement of purchase and sale for the extension of the condition. Which of the following is NOT correct?

A) The salesperson should prepare the amendment with midnight, May 17 as the irrevocable time.
B) To play it safe, the salesperson should amend the condition with May 18 as the expiry date.
C) The buyer can use the same amendment to ask for a change of the closing date.
D) The buyer can still waive the condition before the expiry date if the seller refuses to sign the amendment, provided there is a waiver provision in the condition.

Solutions: