NAME: ________________________________________________

GOOD LUCK!

1. The enactment of the Real Estate Service Act created a body that will regulate the real estate service
practice. This regulatory body is named
a. Professional Regulatory Commission
b. Professional Board of Real Property Practitioners
c. Professional Board of Real Estate Service
d. Professional Regulatory Board for Appraisers

2. This term refers to an official in the local government unit, who performs appraisal and assessment of real
properties, including plants, equipment, and machineries, essentially for taxation purposes.
a. Appraiser
b. Assessor
c. Consultant
d. Broker

3. A duly registered and licensed natural person who works in a local government unit and performs appraisal
and assessment of real properties, including plants, equipment, and machineries, essentially for
taxation purposes is referred to as
a. real estate appraiser
b. real estate broker
c. real estate consultant
d. real estate assessor

4. A duly accredited natural person who performs service for, and in behalf of a real estate broker who is
registered and licensed by the Professional Regulatory Board of Real Estate Service for or in expectation of
a share in the commission, professional fee, compensation or other valuable consideration is referred to as
a. real estate salesperson
b. real estate broker
c. real estate appraiser
d. real estate consultant

5. This term refers to a person who conducts valuation/appraisal; specifically, one who possesses the
necessary qualifications, license, ability and experience to execute or direct the valuation/appraisal of
real property.
a. Appraiser
b. Broker
c. Assessor
d. Consultant

6. Defined as the physical land and those human-made items, which attach to the land.
a. Real property
b. Real estate
c. Personal property
d. Asset

7. The ownership of real estate is called

a. bundle of rights.
b. real property.
c. fee simple.
d. freehold.

8. Real property includes all the rights, interests, and benefits related to the ownership of real estate.
a. bundle of rights.
b. real property.
c. fee simple.
 d. freehold.
9. A term used for the amount asked, offered, or paid for a good or service.
a. Cost
b. Value
c. Price
d. Replacement cost

10. The price paid for goods or services or the amount required to create or produce the good or service.
a. Value
b. Price
c. Cost
d. Selling price

11. An economic concept referring to the price most likely to be concluded by the buyers and sellers.
a. Cost
b. Value
c. Price
d. Market

12. The environment in which goods and services trade between buyers and sellers through a price mechanism.
a. Market
b. Medium
c. Stock exchange
d. Appraisal

13. A statement of the fundamental measurement principles of a valuation on a specified date.

a. Market value
b. Selling price
c. Economic condition
d. Basis of value

14. In markets characterised by extreme volatility or severe disequilibrium between supply and demand, the
highest and best use of a property may be a / an
a. holding for future use.
b. interim use.
c. existing use.
d. commercial utility

15. Where land use and zoning are in a state of change, the immediate highest and best use of a property may
be a / an
a. interim use.
b. present use.
c. residential use.
d. commercial use.

16. This principle holds that a prudent person would not pay more for a good or service than the cost of
acquiring an equally satisfactory substitute good or service.
a. Principle of highest and best
b. Principle of anticipation
c. Principle of substitution
d. Principle of competition
17. This comparative approach considers the sales, listings or offers of similar or substitute properties and
related market data, and establishes a value estimate by processes involving comparison.
a. Market data approach
b. Cost approach
c. Income approach
d. Contractor’s method
18. This comparative approach considers income and expense data relating to the property being valued and
estimates value through a capitalisation process.
a. Market data approach
b. Income approach
c. Cost approach
d. Residual technique

19. This comparative approach considers the possibility that, as an alternative to the purchase of a given
property, one could acquire a modern equivalent asset that would provide equal utility.
a. Market data approach
b. Income approach
c. Cost approach
d. Building residual technique

20. A duly registered and licensed natural person who, for a professional fee, commission or other valuable
consideration, acts as an agent of a party in a real estate transaction to offer, advertise, solicit, list,
promote, mediate, negotiate or effect the meeting of the minds on the sale, purchase, exchange, mortgage,
lease or joint venture, or other similar transactions on real estate or any interest therein.
a. Real estate appraiser
b. Real estate salesperson
c. Real estate broker
d. Real estate developer

21. In asset valuation, this term refers to the adjustments made to the cost of reproducing or replacing the asset
to reflect physical deterioration and functional (technical) and external (economic) obsolescence in order to
estimate the value of the asset.
a. Deterioration
b. Depreciation
c. Replacement cost
d. Reproduction cost

22. In property appraisal, these are suppositions taken to be true, involving facts, conditions, or situations
affecting the subject (property being appraised), or the approach in the valuation.
a. Assumptions
b. Market conditions
c. Perceptions
d. Observations

23. A duly registered and licensed natural person who, for a professional fee, compensation or other valuable
consideration, offers or renders professional advice and judgment on: (i) the acquisition,
enhancement, preservation, utilization or disposition of lands or improvements thereon; and (ii) the
conception, planning, management and development of real estate projects.
a. Real estate broker
b. Real estate appraiser
c. Real estate consultant
d. Real estate developer

24. These are constraints that maybe imposed by clients or by statutory law that would likely to affect
valuation.
a. Limiting Conditions
b. Assumptions
 c. Observations
d. Valuation methods

25. A person who possesses the necessary qualifications, ability, and experience to execute/performed a
valuation.
a. Appraiser or valuer
b. Consultant
c. Broker
d. Salesperson

26. Is a valuer or an appraiser who is in the employ of either the entity that owns the assets or the accounting
firm responsible for preparing the entity’s financial record and/or reports.
a. External Valuer
b. Public Sector Appraiser
c. Internal Valuer
d. Valuer General

27. Is a valuer or an appraiser, together with any associates, has no material links with the client, an agent
acting on behalf of the client or the subject of the assignment.
a. External Valuer
b. Internal Valuer
c. Assessor
d. Broker

28. As provided for in the Philippine Valuation Standards, the four property types are:
a. Real estate, asset, machinery, plant and equipment
b. Real property, personal property, businesses and financial interests
c. Real estate, fixture, chattel and trade related
d. Real property, machinery, equipment and plant

29. Families are more aware of recycling their consumer wastes than ever before. This is an example of which
kind of force:
a. Social
b. Governmental
c. Economic
d. Environmental

30. Absolute ownership subject only to limitations imposed by the country is known as
a. Fee simple estate.
b. Leasehold estate.
c. Lease fee estate.
d. Severalty.

31. A duly registered and licensed natural person who, for a professional fee, compensation or other valuable
consideration, performs or renders, or offers to perform services in estimating and arriving at an opinion
of or acts as an expert on real estate values, such services of which shall be finally rendered by the
preparation of the report in acceptable written form.
a. Real estate appraiser
b. Real estate assessor
c. Real estate broker
d. Real estate consultant
32. Interests in items that are not permanently attached or affixed to real estate and are generally characterized
by their moveability.
a. Real estate property
b. Fixtures
c. Personal property
d. Chattel

33. Any commercial, industrial, service or investment entity pursuing an economic activity is referred to as
a. Financial interests
b. Real property
c. Personal property
d. Business

34. Financial interests in property result from the legal division of ownership interests in businesses and real
property, from the contractual grant of an optional right to buy or sell property at a stated price within a
specified period, or from the creation or investment instruments secured by pooled real estate assets.
a. Business
b. Financial interests
c. Personal property
d. Real estate investment trust

35. The process of acquiring private property for public use is called
a. Eminent domain
b. Police power
c. Escheat
d. Condemnation

36. A type of business involving a combination of two or more entities that join to undertake a specific project.
a. Syndication
b. Limited partnership
c. Joint venture
d. General partnership

37. In statistics, this term refers to the difference between the highest and the lowest scores.
a. Standard deviation
b. Mode
c. Mean
d. Range

38. The principle of increasing and decreasing returns relates to the principle of balance as well as to the
principle of contribution. This principle holds that as capital units are added, a certain point is reached
where the added units do not contribute value commensurate with their costs.

a. Principle of substitution
b. Principle of balance
c. Principle of contribution
d. Principle of increasing and decreasing returns

39. The right of government to acquire private property for public use is referred to as
a. eminent domain.
b. police power.
c. escheat.
d. taxation.
40. Tax Imposed on profit presumed have been realized on the sale or disposition of lands and/or buildings.
a. Estate tax
b. Capital gains tax
c. Inheritance tax
d. Realty tax

41. In statistics, this term refers to the measurement of how much all the scores in a distribution typically
deviate or vary from the mean.
a. Standard Deviation
b. Variance
c. Mode
d. Range

42. An ownership arrangement in which all partners share in investment gains and losses and each is fully
responsible for all liabilities.
a. Limited partnership
b. General partnership
c. Joint venture
d. Syndication

43. Tax imposed on the right to transmit real and personal properties upon death of the property owner
(decedent).
a. Inheritance tax
b. Capital gains tax
c. Estate tax
d. Real estate tax

44. Refers to government housing projects which may either be a subdivision or a condominium intended for
homeless low-income family beneficiaries

a. Residential subdivision
b. Low cost housing
c. Socialized housing
d. Marginal housing

45. An item that was once personal property that has become part of the real estate is referred to as
a. Real property
b. Real estate
c. Fixture
d. Equipment

46. The purest and most complete form of real estate ownership is
a. leased fee estate.
b. Leasehold estate.
c. fee simple.
d. Real property.

47. The right of government to regulate land use for the public good.
a. Escheat
b. Eminent domain
c. Police power
d. Taxation
48. This describes the value of an asset that has reached the end of its economic life for the purpose it was
made and the asset may still have value for an alternative use or for recycling.
a. Scrap value
b. Salvage value
c. Market value
d. Liquidation value

49. The right of governments to acquire private property for public use, such as a road widening.
a. Eminent domain
b. Expropriation
c. Police power
d. Condemnation

50. A limitation on the use of real estate through a written legal document that is usually recorded.
a. Mortgage
b. Deed restriction
c. Lien
d. Chattel

51. This term refer to the conveyance of the right to use part of a land for a specific purpose and thus divide the
bundle of rights.
a. Lease
b. Encroachment
c. Easement
d. Contract

52. A loan or promissory note that is secured by the real estate.

a. Lease
b. Mortgage
c. Lien
d. Chattel

53. A trespass on another’s land is a from of a / an

a. Easement
b. Encroachment
c. Mortgage
d. Restriction

54. A government restriction imposed on ownership of real estate that actually means going to the state.
a. Eminent domain
b. Police power
c. Escheat
d. Taxation

55. The most common form of ownership where one person or corporation owns the entire bundle of rights,
still subject to governmental and private restrictions.
a. Severalty
b. Condominium
c. Leased fee
d. Real property
56. This term means is that the property itself cannot be divided, only the ownership interest.
a. Lease interest
b. Real property
c. Undivided interests
d. Financial interests

57. A form of ownership in which a corporation owns the land and improvements, and the residents own stock
in the corporation. Then, the corporation signs an exclusive lease with the tenant-stockholder.
a. Cooperative
b. Condominium
c. Time-share
d. Severalty

58. A form of partial ownership in which other tenants in common purchase the right of use/occupancy for a
specified period of time, say one week per year.
a. Cooperative
b. Condominium
c. Time-share
d. Severalty

59. The final step in the valuation process.

a. Identification of the real estate
b. Data analysis
c. Correlation of value
d. Valuation reporting

60. Communicates to users and third-party readers the value conclusion and confirms the basis of the valuation,
the purpose of the valuation, and any assumptions or limiting conditions underlying the valuation.
a. Valuation report
b. Valuation process
c. Correlation of value
d. Valuation approaches

61. The following statements are true when applied to Valuation Standards except
a. Standards are statements of recognized principles and concepts
b. Standards are statement of best practice in procurement and reporting
c. Standards are statements of accepted definitions
d. Standards prescribe specific methods of valuation for different purposes

62. The value of property to a particular investor, or a class of investors, for identified investment or
operational objectives.
a. Investment Value
b. Value in use
c. Going concern value
d. Market value

63. An amount above the Market Value that reflects particular attributes of an asset that are only of value to a
particular purchaser.
a. Plottage value
b. Special Value
c. Investment value
d. Value in use
64. This is a form of ownership in which an owner has an interest (usually fee simple) in a certain unit defined
such as the space between the interior walls, the ceiling, and the floor of that unit and the owner also owns
a pro-rata share of the common areas (drives, grounds, recreational amenities, etc.) within the development.
a. Cooperative
b. Leased fee estate
c. Fee simple
d. Condominium

65. An additional element of value created by the combination of two or more interests where the value of the
combined interest is worth more than the sum of the original interests.
a. Synergistic value.
b. Market value
c. Investment value
d. Going concern value

66. The International Financial Reporting Standards adopt these two models for the recognition of property
assets in the balance sheet:
a. Cost model and value in use model
b. Cost model and fair value model
c. Cost model and investment value model
d. Cost model and going concern value model

67. Assets owned and/or controlled by governmental or quasi-governmental entities to provide goods or
services to the general public.
a. Public sector assets
b. Real estate
c. Income generating assets
d. Real property

68. This concept is based on the notion that although two or more parcels of real estate may have physical
similarities and closely resemble one another, there may be significant differences in how they can be used.
a. Utility
b. Value
c. Highest and best use
d. Substitution

69. The approach to value perceives value as created by the expectation of future benefits (income streams).
a. Market data approach
b. Income approach
c. Cost approach
d. Allocation

70. This approach to value recognizes that property prices are determined by the market. Market Value can,
therefore, be calculated from a study of market prices for properties that compete with one another for
market share.
a. Market data approach
b. Cost approach
c. Capitalization process
d. Income approach

71. When data are available, this approach to value is the most direct and systematic approach to estimating
value.
a. Cost approach
b. Income approach
c. Market data approach
d. Residual technique
72. Describes a valuation where an entire business is transferred as an operational entity.
a. Going concern value
b. Value in use
c. Market value
d. Investment value

73. This approach to value is also known as the contractor’s method, and is recognized in most countries.
a. Market data approach
b. Asset based valuation
c. Cost approach
d. Income approach

74. A form of real property, arising from the contractual relationship between one who owns the property and
one who typically receives a non-permanent right to use the property in return for rental payments or other
valuable economic consideration.
a. Lease interests
b. Fee simple
c. Freehold
d. Condominium

75. In business valuation, this approach may be similar to the cost approach used by appraisers of different
types of assets.
a. Income approach
b. Market data approach
c. Residual technique
d. Asset-based approach

76. Specific materials that, by their presence or proximity, may have adverse effect on property value because
of their potential to cause harm to life-forms.
a. Fully depreciated buildings and improvements
b. Hazardous and toxic substances
c. Non-fruit bearing trees
d. Informal settlers

77. The current cost of replacing an asset with its modern equivalent asset less deductions for physical
deterioration and all relevant forms of obsolescence and optimization.
a. Replacement cost
b. Reproduction cost
c. Cost to cure
d. Quantity survey method

78. Refers to the loss in value of an asset resulting from wear and tear over time, including any lack of
maintenance.
a. Functional obsolescence
b. Economic obsolescence
c. Deferred maintenance
d. Physical deterioration

79. Refers to loss in value that can be caused by advances in technology that result in new assets being capable
of a more efficient delivery of goods and services.
a. Functional obsolescence
b. Economic obsolescence
c. Deferred maintenance
 d. Physical deterioration

80. A charge against a property in which the property is security for payment of a debt is called a
a. lien.
b. mortgage.
c. escheat.
d. restriction.

81. The Enchanted Kingdom theme park in Sta. Rosa has had a significant impact on uses of land in its vicinity
for many years and an influence on the value of that land. Which of the four forces does this represent?
a. Social
b. Governmental
c. Economic
d. Environmental

82. A financial modeling technique used in the income approach to value that is based on explicit assumptions
regarding the prospective income and expenses of a property or business.
a. Direct capitalization
b. Annuity method
c. Discounted cash flow
d. Investment method

83. A type of review undertaken to ensure that a valuation meets or exceeds the compliance requirements or
guidelines of the specific market and, at a minimum, conforms to Generally Accepted Valuation Principles
of the Philippine Valuation Standards.
a. Field review
b. Technical review
c. Desk review
d. Administrative review

84. The rights and privileges granted to the owner of intangible assets.
a. Personal property
b. Bundle of rights
c. Intangible property
d. Tangible property

85. Desk Review. A valuation review that is limited to the data presented in the report, which may or may not
be independently confirmed.
a. Field review
b. Technical review
c. Desk review
d. Administrative review

86. This theory involves the concept that land cannot be valued under one highest and best use while the
improvements are valued based on another highest and best use.
a. Consistent use
b. Contribution
c. Balance
d. Anticipation

87. Refers to a housing program and projects covering houses and lots or homeless only undertaken by the
government or the private sector for the underprivileged and homeless citizens.
a. Low cost housing
b. Socialized housing
c. Subdivision development
 d. Bliss project

88. A valuation review performed by an appraiser to form an opinion as to whether the analyses, opinions, and
conclusions in the report under review are appropriate, reasonable, and supportable.
a. Field review
b. Technical review
c. Desk review
d. Administrative review

89. These are individual properties, such as hotels, fuel stations, and restaurants that usually change hands in
the marketplace while remaining operational.
a. Specialized properties
b. Public sector assets
c. Institutional properties
d. Trade related properties

90. A revenue-raising procedure, based on the assessed value of property related to a scale of charges defined
by statute within a specified time-frame.
a. Gross income taxation
b. Ad valorem taxation
c. Capital gains taxation
d. Estate taxation

91. In mass appraisal, this is the process of analyzing sets of property and market data to determine the specific
parameters operating upon a model.
a. Standard deviation
b. Range
c. Mode
d. Calibration

92. The practice of appraising multiple properties as of a given date by a systematic and uniform application of
appraisal methods and techniques that allow for statistical review and analysis of results.
a. Mass appraisal
b. Valuation process
c. Multiple regression
d. Grid analysis

93. Represents the ownership interest of a lessor owning real estate that is subject to lease to others
a. Leasehold fee
b. Leased fee
c. Partial interest
d. Bundle of rights

94. Any form of lease rental arrangement in which the lessor receives a form of rental that is based on the
earnings of the lessee. Percentage rent is an example.
a. Turnover rent
b. Base rent
c. Market rent
d. Economic rent

95. Rights generally inherent in the ownership of real estate include but are referred to as
a. Property rights
b. Real property
c. Bundle of rights
d. Lease interests
96. At the most fundamental level, value is created and sustained by the interrelationship of five factors that are
associated with any product, service, or commodity. These are –
a. Utility, need, purchasing power, buyers and sellers
b. Capital markets, money markets, discount rate and reserve requirements
c. Utility, scarcity, desire, purchasing power, and transferability
d. Location, size, shape, terrain and elevation

97. In property markets, this represents the quantity of property interests that are available for sale or lease at
various prices in a given market within a given period of time, assuming labour and production costs
remain constant.
a. Demand
b. Purchasing power
c. Desirability
d. Supply

98. In property markets, this constitutes the number of possible buyers or renters seeking specific types of
property interests at various prices in a given market within a given period of time, assuming other factors
such as population, income, future prices, and consumer preferences remain constant.
a. Demand
b. Supply
c. Active market
d. Efficient market

99. This economic principle holds that value is simply a function of the present worth of future benefits.
a. Principle of substitution
b. Principle of contribution
c. Principle of anticipation
d. Principle of highest and best use

100. Public sector land valuation and taxation in the Philippines is the domain of two (2) arms of the
government, namely:
a. Department of Budget and Management and Local Government Units
b. Land Registration Authority and Bureau of Internal Revenue
c. Local Government Units and Bureau of Internal Revenue
d. Local Government Units and National Tax Research Center

101. Related to the property itself, this principle holds that value is achieved and maintained when all elements
are in proper proportion.
a. Principle of conformity
b. Principle of balance
c. Principle of contribution
d. Principle of increasing and decreasing returns

102. The principle of change holds that as time and market conditions change, so does supply and demand for
real estate, and thus, the value of real estate.
a. Principle of change
b. Principle of substitution
c. Principle of anticipation
d. Principle of progression or regression

103. This economic principle holds that a prudent purchaser would pay no more for a home than it would cost
him or her to build or buy another one.
a. Principle of conformity
b. Principle of balance
 c. Principle of contribution
d. Principle of substitution

104. A valuation review that includes inspection of the exterior and sometimes the interior of the subject
property and possibly inspection of the comparable properties to confirm the data provided in the report.
a. Technical review
b. Desk review
c. Administrative review
d. Field review

105. It is defined as that logical, legal, and most probable use which will yield the greatest net income to the
land over a sustained period of time.
a. Interim use
b. Actual use
c. Highest and best use
d. Existing use

106. An ______________ market is one that is characterized by goods or services that are easily produced and
readily transferable, with a large number of buyers and sellers.
a. Active
b. Calm
c. Inefficient
d. Efficient

107. This theory is based on the idea that the greater the volume of an item, the less each incremental volume
should cost.
a. Cheaper by the dozen
b. Economies of scale
c. Anticipation
d. Increasing returns

108. The surplus productivity principle recognizes the four agents of production, which are
a. Land, buildings, other land improvements and machinery
b. Plant, machinery, equipment and technology
c. Land, labor, capital and entrepreneurship
d. Land, buildings, labor and capital

109. In any enterprise, labor must be paid first, with capital paid after that, entrepreneurship is then paid. The
residual income is attributed to the land (including buildings). This concept is applies in what economic
principle affecting values?
a. Economies of scale
b. Contribution
c. Balance
d. Surplus productivity

110. This term means coordination or management.

a. Capital
b. Labor
c. Entrepreneurship
d. Production

111. Sales Comparison or Market Data Approach. This comparative approach considers the sales or offers of
similar or substitute properties and related market data, and establishes a value estimate by processes
involving comparison.
 a. Market data approach
b. Income approach
c. Cost approach
d. Development technique

112. The process of orchestrating land, labor, and capital to produce an item.
a. Conduction
b. Analysis
c. Entrepreneurship
d. Capitalization

113. The forces that impact real estate values are the following:
a. Physical, economical, sociological and physiological
b. Population, income level, skill levels and social environ
c. Social, economic, physical or environmental and governmental
d. Political, economical, governmental and physical

114. This forces relate to trends in society or culture, and sometimes these forces are imagined while at other
times they are based on actual facts and figures.
a. Environmental
b. Governmental
c. Physical
d. Social

115. A / An ______________________ is a group of complementary land uses.

a. Zone
b. Area
c. Neighborhood
d. Municipality

116. In the application of this technique to estimate value, the building value is estimated as the present value of
the residual income attributable to the building of an income producing property.
a. Building residual technique
b. Land residual technique
c. Property residual technique
d. Development technique

117. The term used to describe the connecting of complementary uses to the homogenous land uses (zone) is
a. linkage.
b. road network.
c. Passage.
d. right-of-way.

118. Neighborhoods and zones alike generally exist in one of four life cycle stages; these are –
a. growth, stability, renovation, and rebirth
b. growth, decline, reconstruction, and revitalization
c. growth, stability, decline, and revitalization.
d. growth, stability, decline and rebuilding

119. These are assets that embody a cultural, historic, and/ or architectural heritage.
a. Agricultural properties
b. Historic properties
c. Trade related properties
d. Public sector assets

120. The initial stage in a neighborhood or zone’s life cycle. This refers to the period in which the neighborhood
or zone is expanding and developing.
 a. Revitalization
b. Decline
c. Stability
d. Growth

121. When a neighborhood can no longer compete with other comparable neighborhoods, it usually enters the
_________________ stage of its life cycle.
a. Revitalization
b. Decline
c. Stability
d. Growth

122. The act of distinguishing or delineating markets that the appraiser should consider in his data program is
called
a. market segregation.
b. market analysis.
c. market segmentation.
d. market study.

123. In this type of market, goods and services are not readily produced or easily transferable, with no readily
identified group of buyers and sellers active in a particular marketplace.
a. Efficient market
b. Inefficient market
c. Buyer’s market
d. Seller’s market

124. The study of a specific market. It is the collection and dissection of data and the conversion of that data to
information that can be used for analysis and decision-making by an appraiser or analyst.
a. Marketability study
b. Feasibility study
c. Market analysis
d. Investment analysis

125. A rate of return used to convert a monetary sum, payable or receivable in the future, into present value.
Theoretically it should reflect the opportunity cost of capital, i.e., the rate of return the capital can earn if
put to other uses having similar risk.
a. Internal rate of return
b. Discount rate
c. Overall rate
d. Investment rate

126. The three types of market analysis are:

a. Market study, marketability study and feasibility study
b. Market data approach, sales comparison approach and offers
c. Investment analysis, economic base analysis, monetary analysis
d. Statistical study, market study and demographics study

127. The analysis of an environment of buyers/sellers and/or landlords/tenants (lessors/lessees).

a. Marketability study
b. Feasibility study
c. Market study
d. Investment analysis

128. Type of market analysis that addresses the time required to absorb a particular product, and the price or rent
level at which that product would be accepted into the marketplace.
a. Marketability study
b. Feasibility study
 c. Market study
d. Investment analysis

129. A ____________ study is simply a comparison of cost versus the value if the project is undertaken.
a. Marketability study
b. Feasibility study
c. Market study
d. Investment analysis

130. A study undertaken for the purposes of development and investment, the evaluation of investment
performance, or the analysis of a transaction involving investment properties.
a. Economic base study
b. Market study
c. Feasibility study
d. Investment analysis

131. A mortgage secured by a group of properties or a number of lots.

a. Blanket mortgage
b. Simple mortgage
c. Lein
d. Mechanic’s lien

132. If the contract rent and the market rent are equal, the Leasehold or Lessee’s Interest is _______________,
assuming there is no leasehold improvement.
a. Positive lease
b. Negative lease
c. Zero
d. Equal

133. This comparative approach to value involves the cost of acquiring equivalent land and constructing an
equivalent new structure.
a. Market data approach
b. Cost approach
c. Income approach
d. Builder’s method

134. In operating lease, the value of the Lessee’s Interest is estimated as the present value
a. of rental payment for remaining life of the lease agreement
b. of rental gain or loss and the value of the leasehold improvement, if any
c. of rental payment plus reversion value of the property at the end of the lease agreement
d. of rental gain or loss plus reversion value of the leasehold improvement, if any

135. A _____________________ leasehold interest is created when the contract rent is higher than the
current market rent.
a. Positive
b. Equal
c. Zero
d. Negative

136. A group of homogenous land uses.

a. District
b. Neighborhood
c. City
d. Zoning
137. Typically a factor produced by two components, which reflects precise differences between properties and
facilitates analysis in the three approaches to value, e.g., price per square meter or square foot, or the ratio
of a property’s sale price to its net income (net income multiplier/years’ purchase).
a. Comparable data
b. Elements of comparison
c. Units of comparison
d. Physical characteristics

138. The cost to create a virtual replica of the existing structure, employing the same design and similar building
materials.
a. Replacement cost, new
b. Unit-cost-in-place method
c. Quantity survey method
d. Reproduction cost, new

139. The current cost of a similar new item having the nearest equivalent utility as the item being appraised.
a. Replacement cost, new
b. Unit-cost-in-place method
c. Quantity survey method
d. Reproduction cost, new

140. An asset which has a similar function and equivalent productive capacity to the asset being valued, but of a
current design and constructed or made using current materials and techniques.
a. Replacement asset
b. Reproduced asset
c. Modern equivalent asset
d. Public sector asset

141. The process of adjusting the replacement cost to reflect that an asset may be technically obsolete or over-
engineered, or the asset may have a greater capacity than that required.
a. Reproduction cost, new
b. Capitalization
c. Value engineering
d. Optimization

142. A real estate mall developer purchases a site with the intent of building a regional mall because the
immediate area has a significant number of households and the income level of those households is
affluent. What type of force is the neighborhood going through?
a. Social
b. Governmental
c. Economic
d. Environmental

143. Specific characteristics of properties and transactions that cause the prices paid for real estate to vary.
a. Comparable data
b. Units of comparison
c. Elements of comparison
d. Comparable sale prices

144. Method of estimating the reproduction cost or replacement cost that combines the direct and indirect costs
into a single unit-in-place amount, which when multiplied by the unit measure of the improvement’s
component will yield the cost of the component.
a. Unit-in-place
b. Comparative
c. Quantity survey
d. Index or trending
145. The cost of replacing an asset with an equally satisfactory substitute asset; normally derived from the
current acquisition cost of a similar asset, new or used, or of an equivalent productive capacity or service
potential.
a. Replacement cost
b. Unit-cost-in place
c. Reproduction cost
d. Builder’s method

146. The Subic Freeport Zone is one of the largest developments in Central Luzon. What force does this
represent?
a. Social
b. Governmental
c. Economic
d. Environmental

147. The process by which a least cost replacement option is determined for the remaining service potential of
an asset.
a. Reproduction cost, new
b. Capitalization
c. Value engineering
d. Optimization

148. Method of estimating the reproduction cost or replacement cost that involves the adjustment of the original
costs to current costs by a multiplier derived from published cost indexes.
a. Unit-in-place
b. Comparative
c. Quantity survey
d. Index or trending

149. Type of lease which involves the transfer ownership from lessor to lessee.
a. Operating lease
b. Financing lease
c. Leased fee
d. Leasehold fee

150. Lose in property value are caused by deterioration or obsolescence

a. Depreciation
b. Deferred maintenance
c. Cost to cure
d. Replacement cost

151. The difference between the cost to reproduce or replace a property and its present value
a. Replacement cost
b. Cost to cure
c. Depreciation
d. Regression

152. Major causes of depreciation are the following except

a. Deferred maintenance
b. Physical deterioration
c. Functional obsolescence
d. External obsolescence
153. Refers to the wear and tear from regular use and the impact of the elements
a. Physical deterioration
b. Functional obsolescence
c. External obsolescence
d. Adverse market condition

154. Method of estimating reproduction or replacement costs by applying the average or typical comparative
cost (per square-meter cost) of similar improvements.
a. Quantity survey method
b. Unit-in-place method
c. Comparative method
d. Index or trending method

155. This cost estimate envisions constructing a structure of comparable utility, employing the design and
materials that are currently used in the market.
a. Reproduction cost
b. Replacement cost
c. Quantity survey method
d. Unit-in-place method

156. The period of time over which improvements contribute to property value.
a. Useful life
b. Economic life
c. Remaining life
d. Lifespan

157. Lose in value caused by a flaw in the structure, materials, or design that diminishes the function, utility, and
value of the improvement
a. Functional obsolescence
b. Economic obsolescence
c. Physical deterioration
d. Deferred maintenance

158. The period of time over which the components of the improvement may reasonably be expected to perform
the functions for which they were designed.
a. Economic life
b. Useful life
c. Remaining life
d. Used life

159. The age indicated by the condition and utility of a structure

a. Used life
b. Chronological life
c. Effective age
d. Actual age

160. A method of estimating depreciation that involves the development of a depreciation estimate by studying
sales of comparable properties that have depreciated to a similar degree as the improvement.
a. Cost to cure method
b. Component method
c. Market extraction method
d. Observed condition method

161. A method of estimating depreciation whereby the appraiser estimates the total economic life expectancy of
the existing structure as well as its effective age, based on an analysis of sales of similar structures
 a. Age-life method
b. Component method
c. Market extraction method
d. Observed condition method

162. The estimated period from the actual age of a component to the end of its total useful life expectancy.
a. Remaining economic life
b. Remaining useful life
c. Actual age
d. Effective age

163. An impairment of the utility or salability of an improvement or property due to negative influences outside
the property.
a. Functional obsolescence
b. Physical deterioration
c. Adverse market condition
d. Economic obsolescence

164. Sometimes called historical age or chronological age, is the number of years that have elapsed since
building construction was completed.
a. Effective age
b. Actual age
c. Remaining useful life
d. Remaining economic life

165. A method of estimating the reproduction cost or replacement cost that involves a complete cost itemization
of all direct and indirect cost to be incurred or incurred in the construction of an improvement.
a. Index method
b. Cost-in-place method
c. Quantity survey method
d. Comparative method

166. Primarily used to allocate a known amount of total depreciation, estimated by either the market extraction
method or the age-life method, into its components
a. Component method
b. Market extraction method
c. Age-life method
d. Breakdown method

167. The process of retiring a mortgage or debt over a specified time period.
a. Debt service
b. Installment
c. Amortization
d. Equity

168. Represents the money earned for the right to use capital.
a. Equity
b. Amortization
c. Interest
d. Principal amount

169. Also known as debt service.

a. Amortization
b. Equity
c. Installment
 d. Payment

170. Credit regulation devices that the Bangko Sentral ng Pilipinas can use to regulate the supply of money.
a. Lending rates and amortization rates
b. Capitalization rates and mode of payments
c. Discount rates and reserve requirements
d. Production of new bills and disposal of old bills

171. The government’s management of revenues (taxes) and expenses (appropriations) is called
a. monetary policy
b. fiscal policy
c. repayment policy
d. credit policy

172. The Philippines’ fiscal policy is managed by the

a. Bangko Sentral ng Pilipinas
b. Department of Finance
c. Department of Budget and Management
d. Department of Justice

173. The estimated amount for which a property, or space within a property, should lease on the date of
valuation between a willing lessor and a willing lessee on appropriate lease terms in an arm’s-length
transaction, after proper marketing wherein the parties had each acted knowledgeably, prudently, and
without compulsion
a. Contract rent
b. Market rent
c. Rental rate
d. Leased fee

174. Financial vehicles with traditional maturities or investment periods of less than one year.
a. Capital markets
b. Cash deposits
c. Time deposits
d. Money markets

175. In the income approach to value, reconstructed operating statements specify that the income projection is
subject to the assumption that the property is run by a / an
a. expert competent management.
b. average competent management.
c. inefficient operator.
d. substandard management.

176. Capital markets include financial vehicles with usual maturities of more than one year.
a. Capital markets
b. Cash deposits
c. Time deposits
d. Money markets

177. In this technique the land value is estimated as the present value of the residual income attributable to the
land of an income producing property.
a. Building residual technique
b. Development technique
c. Land residual technique
d. Discounted cash flow analysis

178. A loan for personal property and secured by personal property.

a. Real estate mortgage
 b. Chattel mortgage
c. Liens
d. Blanket mortgages

179. ________________________________________ specify that the income projection is subject to the

assumption that the property is run by a reasonably efficient operator or average competent management.
a. Operating statements supplied by client
b. Operating statements supplied by agent of client
c. Operating statements reconstructed by the appraiser
d. Operating statements reconstructed by the internal auditor

180. The process of converting an income stream into value.

a. Capitalization
b. Investment analysis
c. Market analysis
d. Depreciation

181. The resulting amount of reducing the annual potential gross income by a vacancy allowance amount. 
a. Gross profit
b. Net operating income
c. Effective net income
d. Effective gross income

182. Operating expenses are deducted from the effective gross income to determine the
a. annual net operating income for the property. 
b. annual net profit for the property.
c. annual gross profit for the property.
d. annual depreciation of the property.

183. Process of converting income into value by dividing a single year’s stabilized net operating income, by an
all-risks rate.
a. Yield capitalization
b. Discounted cash flow analysis
c. Direct capitalization
d. Valuation approach

184. In the application of the discounted cash flow analysis to operating real properties, the value of the property
is estimated as the net present value of
a. The series of periodic net operating incomes.
b. The reversion value, anticipated at the end of the projection period.
c. The series of periodic net operating incomes, along with an estimate of the reversion value,
anticipated at the end of the projection period.
d. The value of the business at the end of the projection period.

185. Profit-making entities operating to provide consumers with products or services.

a. Financial interests
b. Real property
c. Public sector asset
d. Businesses

186. A credit regulation device of the BSP that refers to the percentage of deposits that must be retained by
banks.
a. Discounted rates
b. Fiscal policy
c. Credit regulation
d. Reserve requirement
187. In the application of the discounted cash flow analysis to development properties, the value of the
properties is estimated as the present value of the
a. The series of net cash flows that are discounted over the projected development and marketing
periods.
b. The series of periodic net operating incomes, along with an estimate of the reversion value,
anticipated at the end of the projection period.
c. The series of dividends and the value of the business at the end of the projection period.
d. The series of periodic net operating incomes.

188. This capitalization process considers the time value of money, and is applied to a series of net operating
incomes for a period of years.
a. Direct capitalization
b. Yield capitalization
c. Discounted rate
d. Internal rate of return

189. The estimated period over which existing improvements are expected to continue to contribute to property
value
a. Remaining useful life
b. Effective age
c. Actual age
d. Remaining economic life

190. A method that is used to build a capitalization rate using just two components; financing and equity.
a. Build-up method
b. All risks method
c. Band of investment method
d. Gross income multiplier method

191. Defines the percentage number used to determine the current value of a property based on estimated future
operating income.
a. Absorption rate
b. Selling rate
c. Buying rate
d. Capitalization rate

192. Acquisition of private land by the government for public use could be undertaken thru the following
procedures, except
a. Negotiated sale or purchase
b. Expropriation
c. Exchange or barter
d. Foreclosure

193. A _________________ leasehold interest is created when the market rent is greater than the contract rent. 
a. Negative
b. Equal
c. Zero
d. Positive

194. The discount rate that equates the present value of the net cash flows of a project with the present value of
the capital investment.
a. Discounting rate
b. Overall rate
c. Internal rate of return
 d. Recapture rate

195. This rate reflects both the return on the invested capital and the return of the original investment, which are
basic considerations of potential investors.
a. Discounting rate
b. Overall rate
c. Internal rate of return
d. Recapture rate

196. The rent specified by a given lease arrangement.

a. Economic rent
b. Market rent
c. Contract rent
d. Rental rate

197. The following are standard tests for highest and best of real property, except
a. physically possible
b. politically permissible
c. financially feasible
d. maximally productive

198. Applicable to real estate improvements, the rate warranted by prudent investors that will represent the
return on investment (usually the interest rate or capitalization rate) and the return of investment, for
improvements, this is represented by the recapture rate.
a. Discounting rate
b. Overall rate
c. Internal rate of return
d. Recapture rate

199. Interest Rate + Recapture Rate equals

a. Discounting rate
b. Overall rate
c. Internal rate of return
d. Return on investment

200. This government or public restriction to ownership provides that if a person dies without a will and heirs,
that person is said to have died intestate, and that person’s property transfers to the state.
a. Eminent domain
b. Police power
c. Escheat
d. Expropriation
--- NOTHING FOLLOWS ----