Reference no: EM133038801

1. What is the Return on House for Period?

a. (Increase in House Value During Period - Rent Not Paid - Cost of Upkeep)/Market Value of House Beginning of Period. 

b. (Increase in House Value During Period + Rent Not Paid - Cost of Upkeep)/Market Value of House Beginning of Period. 

c. (Increase in House Value During Period - Rent Not Paid - Cost of Upkeep)/Market Value of House End of Period.

d. (Increase in House Value During Period + Rent Not Paid - Cost of Upkeep)/Market Value of House End of Period. 

e. None of the choices are correct.

2. Which of the following contribute to the rise of inflation?

a. the rise in commodity prices and the rise in labor costs 

b. the rise in commodity prices 

c. All of the choices are correct.

d. the decline in government expenditures 

e. the rise in labor costs

3. How are REITS taxed?

a. At the corporate tax rate 

b. Once when they earn the money, and again when their stockholders receive dividends from those earning 

c. It depends on the cash they have in the bank

d. At the short-term capital gains rate

e. Only on dividend payouts from the company

4. Which of the following is the most popular method of valuing homes?

a. cash flow

b. fair value 

c. replacement cost 

d. market value 

e. comparable sales

5. Consider a purely competitive market with no transaction costs, no difference between borrowing and lending cost, and no taxes. Is it an advantage to buy or to lease an apartment?

a. It is an advantage to lease an apartment

b. It is an advantage to buy an apartment 

c. None of the choices are correct. 

d. They are equal opportunities 

e. It depends on the location

6. Which of the following statements is a benefit of buying a home using debt over leasing?

a. You can count on short-term capital gains. 

b. The absence of tax benefits. 

c. The ability to receive a tax deduction for depreciation. 

d. The ability to receive long-term gains on investment. 

e. The ability to have short term losses.

7. Which of the following is an advantage associated with renting a dwelling?

a. Flexibility in changing your dwelling site. 

b. Mandatory repayment of debt.

c. Mandatory repayment of debt and the necessity of a capital commitment. 

d. The necessity of a capital commitment.

e. The necessity of a capital commitment and flexibility in changing your dwelling site.

8. Choose the correct statement:

a. Gold often declines in times of high inflation 

b. Gold often does well when the world is in turmoil 

c. Gold directly supports paper currencies used in trade 

d. Gold is positively correlated with the stock market 

e. Gold does well during deflationary periods