National Practice
National Practice
Ch1 “License Law” Questions
(Questions ONLY, ANSWERS WILL BE REVEALED WITH PROPER SUBSCRIPTION)
1. List five ways the Real Estate Commission protects consumers.
2. Which of the following is not a duty of the Commission?
A. Administer oaths
B. Maintaining licensee records
C. Keep licensees abreast of relevant real estate topics and laws
D. Regulate licensee compensation practices
National Practice Questions
3. Fees and fines collected by the Commission are held in the
A. General Assembly Citizens Fund.
B. Arkansas Recovery and Remuneration Fund.
C. Arkansas Real Estate Commission Fund.
D. Arkansas License Violations Fund.
4. Licensee members of the Commission are
A. nominated by the Director of the Commission.
B. appointed by the outgoing members.
C. appointed by the Arkansas Governor
D. nominated by the Arkansas Citizens Review Committee of the Commission.
5. Which of the following powers are vested in the Commission?
A. Police powers
B. Subpoena powers
C. Zoning powers
D. Power-of-attorney
6. The salaries of the Commission’s employees are established by
A. the Commission.
B. the Commission’s chairman.
C. the Commission’s director.
D. the Arkansas Legislature.
7. One purpose of real estate license laws is to
A. establish proper transaction procedures among buyers and sellers.
B. prevent fraud against real estate licensees.
C. establish standards of competence among licensees.
D. eliminate unfair trade practices between lenders and borrowers.
8. What is the minimum required balance of the Real Estate Recovery Fund?
A. $2,000,000
B. $50,000
C. $10,000,000
D. $250,000
9. Commissioners serve a term of how many years?
A. 1
B. 2
C. 3
D. 4
10. Funds from the Real Estate Recovery Fund are used for which of the following purposes?
A. Reimbursing licensees for overcharges of fees
B. Educational programs
C. Lobbying efforts for pro-licensee laws
D. Operating deficits incurred by the Commission
11. The executive director of the Commission
A. is also the Chairman of the Commission.
B. is authorized to hire staff and set salary levels.
C. is effectively the CEO of the Commission.
D. is appointed by the governor.
12. Which of the following is not required of at least one of the Commission members?
A. Licensee with five years of experience
B. Minority status
C. 60 years of age
D. That they represent consumers
13. The Real Estate License Law established a Real Estate Recovery Fund
A. to pay for the salaries and activities of the Commission.
B. to protect consumers if their property is foreclosed.
C. for the protection of the public against harmful actions by licensees.
D. for eminent domain purchases by the Commission.
14. Who selects the Commission’s chairman?
A. The Arkansas Association of Realtors
B. The governor
C. The voters of Arkansas
D. The Commission itself
15. Who needs a license BELOW?
a. A resident manager rents apartments for tenants in five neighborhood apartment complexes.
i. YES
ii. NO
b. A leasing assistant negotiates a 12-month lease for her manager.
i. YES
ii. NO
c. A federal employee in the course of her official duties sells one of the buildings in her office complex.
i. YES
ii. NO
d. A manager of a title company sells his own house to a broker.
i. YES
ii. NO
e. A retired auctioneer auctions a property for a friend.
i. YES
ii. NO
f. A salaried employee under written instructions shows a property for sale on behalf of her principal broker.
i. YES
ii. NO
g. A college graduate advertises he will sell properties of other students to raise tuition money for college.
i. YES
ii. NO
h. A person receives and delivers a $500,000 deposit to her principal broker from a buyer.
i. YES
ii. NO
i. A company vice president leases one of the company’s warehouses to a storage firm.
i. YES
ii. NO
j. A senior citizen charges an advance fee for referring an individual to her son who owns a leasing office in town.
i. YES
ii. NO
k. A homeowner advertises to lease his improved basement to a college student.
i. YES
ii. NO
l. An attorney advises a client about how to minimize liability in an upcoming real estate transaction.
i. YES
ii. NO
16. What do you have to do to get your Arkansas salesperson’s license? List as many of the requirements as you can.
· Be of majority age (18 years old).
· Satisfy educational requirements.
· Satisfy experience requirements.
· Pass the appropriate licensing examination.
· Demonstrate a record of professional conduct.
· Provide evidence of honesty, trustworthiness and integrity.
· Complete a criminal history background check.
· Pay the appropriate fees.
17. A friend of yours wants to go into real estate, and she asks you which type of license she should get. For the first part of your answer, you tell her what the four types are and how they differ.
18. Your cousin from Mississippi is moving to Arkansas and wants to go into real estate. He already has a license in Mississippi. How does he get an Arkansas license?
19. Each of the following scenarios relates or best applies to a specific license status, either:
On a separate piece of paper, write down which license status above best suits the scenario depicted.
1. The licensee may renew, but does not have to take any continuing education. Status _____inactive______
2. The licensee must cease practicing on December 31 if he fails to renew. Status: ____active________
3. An inactive licensee who failed to renew until October 15th. Status: ___inactive_________
4. The licensee must complete CE in order to renew under the same status. Status: ____active_________
5. The licensee may not practice one month after its issuance. Status: ___temporary_________
6. The licensee must meet the same requirements as a new applicant to renew. Status: ___Expired more than 2 years_________
7. A licensee reactivates two years after expiration but is not required to complete the CE requirement. Status: ______inactive_______
8. A licensee has been disciplined by the Commission. Status: ____Suspended/revoked________
20. Which of the following is not a requirement of either a broker or salesperson license?
A. To complete a criminal history background check
B. To satisfy educational requirements
C. To be at least 25 years old
D. To pass the appropriate licensing examination
21. The deadline for renewing the license without paying additional fees is
A. September 30.
B. December 31.
C. November 30.
D. July 15.
22. To activate an inactive license, licensees must
A. call the Commission to reclassify their license.
B. complete 6 hours of CE for every year the license was inactive
C. pay a fine to the Real Estate Recovery Fund.
D. retake the Arkansas real estate examination.
23. Broker and salesperson license applicants not residing in Arkansas may
A. request a waiver of the general portion of the exam.
B. request a waiver of the Arkansas law portion of the exam.
C. request a waiver of the entire exam.
D. be required to pay additional fees.
24. Who is ultimately responsible for the company’s activities, notably the activities of other licensees as well as the business’s trust accounts?
A. The executive broker
B. The associate broker
C. The salesperson
D. The principal broker
25. Which leasing duty is NOT exempt from licensure?
A. Receiving a rent payment which will be delivered to the owner
B. Delivering a lease
C. Showing a rental unit under the written directions of a principal broker
D. Negotiating a lease offer
26. An hourly employee receives deposits for delivery to his principal broker employer. Here, this party
A. is exempt from licensure.
B. is exempt, provided he is a full-time employee.
C. is not exempt, since this is not an administrative task.
D. is not exempt, regardless.
27. Which statement regarding non-resident licensure is false?
A. Broker and salesperson license applicants not residing in Arkansas may request a waiver of the general portion of the exam.
B. The non-resident must agree that he or she has read and will abide by the Arkansas Real Estate License Law.
C. The non-resident does not have to affiliate with a resident or non-resident principal broker licensed by the Commission.
D. The non-resident has to pay the required fees.
28. What are the education requirements for initial salesperson licensure?
A. 60 classroom hours including 30 hours covering the basic principles of real estate
B. 60 classroom hours in addition to a broker’s education requirements
C. 30 classroom hours including 10 hours covering the basic principles of real estate
D. 30 classroom hours in addition to a broker’s education requirements
29. Generally, you can buy, lease, rent, or sell your own property, but when you do those things for others for _____________, you ___________ to be licensed.
A. free, do need
B. compensation, do not need
C. free, do not need
D. compensation, do need
30. A license applicant carelessly fails to pay the proper fees following completion of the state exam. What happens as a consequence?
A. The applicant’s fees are doubled.
B. The applicant must re-test.
C. The applicant must re-test and re-apply.
D. The applicant must pay a fine to the Recovery Fund.
31. A license that has been expired for two years may be reactivated as
A. an active license only.
B. an inactive license only.
C. an active or inactive license.
D. It cannot be renewed after 2 years
32. Licensees must have a real estate license on _________ status in order to engage in real estate practice.
A. evoked
B. active
C. authorized
D. approved
33. All licenses, active or inactive, expire on ____________ unless the licensee makes timely payment of a renewal fee, and complies with any prerequisite or condition to licensure or renewal.
A. September 30
B. December 31
C. November 30
D. July 15
34. Who do prospective brokers and salespersons need to get their licenses from?
A. Any brokerage firm
B. They do not need a license.
C. The Arkansas Real Estate Commission
D. The Arkansas Association of Realtors
35. Generally speaking, what happens if an applicant fails the criminal background check due to a felony conviction?
A. They are denied licensure.
B. It depends on how the applicant pleaded.
C. They are issued a temporary license pending further investigation.
D. They will only receive an inactive license.
36. The two sections of the Arkansas real estate examination are
A. a national real estate section and an Arkansas law section.
B. a leasing law section and national real estate law section.
C. a salesperson law section and brokerage section.
D. a national real estate section and an international real estate section.
37. On or about ________ of each year, the Commission sends licensees notice to renew licenses for the upcoming year.
A. September 30
B. December 31
C. November 30
D. July 15
38. To maintain active status, salespersons, associate brokers, and executive brokers must
A. complete a closing every three months.
B. belong to the local Association of Realtors.
C. be employed by a principal broker.
D. sell real estate full time.
39. Challenge Questions: Licensee do’s and don’ts
In the questions below, answer either “CAN” or “CAN’T”
a) Broker Amy names her real estate firm “Hot Springs Investment Brokers” and submits clear photographs of signage to the Commission.
i) CAN
ii) CAN’T
b) Broker Paul’s ABC Realty office is on the 9th floor of an office building. He places his firm name in the lobby directory, and a sign at the entrance to his suite.
i) CAN
ii) CAN’T
c) Broker James takes on the part-time responsibility of running Joyce’s second branch office in addition to his full-time CPA job.
i) CAN
ii) CAN’T
d) Broker Sherman manages ABC Realty’s branch office for his principal broker, Linda. Sherman reconciles his trust account every month on Linda’s behalf and sends the reports to the Commission.
i) CAN
ii) CAN’T
e) Broker Sean takes a listing and carefully inspects the property immediately after signing the agreement.
i) CAN
ii) CAN’T
f) Broker Maureen sells her own property without notifying her principal broker.
i) CAN
ii) CAN’T
g) Salesperson Jim buys a vacation time share. Since it is personal, he does not inform his principal broker.
i) CAN
ii) CAN’T
h) Broker Susan introduces William to another agent, who lists and sells William’s property. Susan makes a legitimate claim for a referral with the lister’s firm.
i) CAN
ii) CAN’T
i) Salesperson Tommy promises to sell the home of owner Grace for less if she contacts him after her current listing expires.
i) CAN
ii) CAN’T
j) License applicant Julie represented that she had never been convicted of a crime because, in one instance, she had been arrested for stealing, but had pleaded no lo contendere.
i) CAN
ii) CAN’T
k) Broker Norman listed his brother’s property without the knowledge of his brother’s wife, who was on vacation.
i) CAN
ii) CAN’T
l) Salesperson Cathy placed an ad in the paper assuring prospective buyer’s that the property would appreciate based on the neighborhood’s 15-year record of value increases.
i) CAN
ii) CAN’T
m) Broker Damien entered into a 15-day listing with a prospective buyer on the assumption that that would be sufficient time to make a sale.
i) CAN
ii) CAN’T
n) Salesperson Judith accepted a referral fee from her friend for referring a buyer to her who bought her property.
i) CAN
ii) CAN’T
40) Buyer Simpson hands salesperson Charlene a $5,000 deposit to accompany an offer. What does Charlene do with the check?
41) Charlene’s seller accepts the offer. How does that affect the deposit, if at all?
42) A broker receives and deposits an advance fee from Frank to locate an apartment for him. Three months later, Frank moves to another state. What happens to the advance fee?
43) The Commission wants brokers to keep records for how many years?
44) If a broker deposits monies into a trust account, are those monies necessarily considered trust funds by the Commission?
45) What funds are allowed to be kept in a trust account besides trust funds?
46) A broker earns a commission out of his trust fund account but keeps it in the account. Anything wrong with that?
47) A buyer insists on keeping her deposit with her own escrow agent. Is the broker still responsible for accounting for those funds?
48) Trust fund reconciliation records must be kept for how long?
49) There are proper ways to disburse from a trust account, and there are improper ways. List as many “proper” circumstances where the broker may legitimately disburse trust account funds.
50) Which of the following regulatory restrictions is false regarding to time-share advertising?
A. Time-share advertising does not have to be registered with the Commission.
B. Advertising may not be false or misleading
C. Advertising may not lead one to believe the number of remaining units is limited or time is “running out” unless supported by clear facts
D. Advertising cannot purport misleading promises of profit or appreciation or impending price increases
51) Who can practice real estate independently of a principal broker?
A. Salespersons
B. Associate brokers
C. Dual agents
D. Nobody can practice real estate independently of a principal broker.
52) Proper trust fund management includes
A. making the records available to all transaction principals for inspection.
B. making the records available for Commission inspection.
C. maintaining strict confidentiality as to the fund balances.
D. reporting interest earned prior to operating account transfers.
53) When a licensee is selling their own property, they must
A. disclose in writing prior to entering into the sale or lease contract that they are a licensed real estate practitioner.
B. disclose orally at first contact that they are a licensed real estate practitioner.
C. disclose orally before signing any contract that they are a licensed real estate practitioner.
D. only disclose if they are asking for $1,000,000 or more for their property.
54) Which of the following would not be on the time-share’s public offering statement?
A. Disclosure of extra fees for use of the project’s facilities or amenities
B. A statement of rescission rights declaring that purchaser has 90 days after contract execution to cancel the contract
C. Written description of any “swapping” program offering the exchange of time-shares with other time-share projects
D. Disclosure of liens or encumbrances affecting title
55) Deposits accompanying time-share reservations must be placed in
A. an interest bearing trust account in Arkansas, held by an independent escrow company or federally insured depository institution.
B. any account in a federally insured depository institution.
C. a non-interest bearing trust account in any location, held by an independent escrow company or federally insured depository institution.
D. a non-interest bearing trust account in Arkansas, held by an independent escrow company or federally insured depository institution.
56) Trust fund reconciliation
A. must be completed monthly by the Commission.
B. must be reconciled monthly by an approved CPA.
C. must be reconciled monthly in writing.
D. must be reconciled every other month and reported to the Commission.
57) It is illegal for the principal broker to deposit non-trust fund monies into the trust account. This illegal act is known as
A. money laundering.
B. dipping.
C. converging.
D. commingling.
58) The account holder must designate ________________ as the recipient of the interest earned in the allowed interest-bearing account.
A. themselves
B. the Arkansas Real Estate Commission
C. the State of Arkansas
D. the Arkansas Real Estate Foundation, Inc.
59) Legitimate operating funds in a broker’s general account do not include
A. unearned commission reserves.
B. advance fees.
C. earned commissions.
D. interest earned on the account.
60) For-sale signs may only be placed on a property
A. before the term of the listing agreement.
B. after the term of the listing agreement.
C. during the term of the listing agreement.
D. if the sign is approved by the Commission.
61) A for-sale sign says: “Home for rent by owner”. Is this a legal sign?
A. Yes, unless the home is owned by a licensee
B. Yes
C. No, since there is no mention of who the owner is
D. No
62) A time share public offering statement is best defined as
A. a summary of all available time share programs and their prices.
B. a description of the project and a profile of the developer.
C. a disclosure statement of all relevant facts regarding the property and selling terms.
D. a comprehensive promotional piece detailing all aspects of the time share programs.
63) All forms used to document agreements must
A. also be available in electronic formats.
B. be approved by a licensed Arkansas attorney prior to use.
C. be approved by the Commission.
D. have the HUD logo on it.
64) A salesperson receives an advance fee for a rental service. What must she do with this money?
A. Deposit it upon lease execution
B. Deliver it immediately to the principal broker
C. Deliver it to the principal broker within 3 business days
D. Deposit it immediately in a trust account
65) A seller’s agent receives an offer from a buyer’s agent to purchase the listed property. Which of the following is true?
A. The buyer must submit the offer to the listing agent within 7 days.
B. The listing agent must submit the offer, provided it is reasonable.
C. The listing agent must submit the offer.
D. The listing agent must submit the offer within 7 days.
66) Which of the following is not a responsibility for licensees regarding real estate agreements?
A. Ensuring all agreements are signed by all parties
B. “Seeing to it” that the exact provisions of real estate agreements between principal parties are in writing
C. Ensuring that the agreed-to offer is fair for all parties
D. Ensuring that all parties to the agreement receive copies of the agreements
67) 4 of 15 Disbursement from the time-share’s reservation trust account may only be made
A. when the purchaser has defaulted, at which time the developer may receive the funds.
B. before the rescission period has elapsed on a contract.
C. when the developer has defaulted, at which time the Commission may receive the funds.
D. to the principal broker.
68) The time-share sale contract is voidable if
A. the purchaser has received the public offering statement.
B. it is in writing.
C. the purchaser has not received the public offering statement.
D. the purchaser has a time-share in another location.
69) Which of the following tasks may not be delegated to the executive broker by the principal broker?
A. Training
B. Signing offers
C. Handling transfer documents
D. All may be delegated
70) It is the principal broker’s responsibility to obtain ____________ approval for his or her company’s name.
A. municipal
B. Association of Realtor
C. Commission
D. federal
71) If a brokerage ceases to exist, who is responsible for the office’s records?
A. The Commission
B. The current principal broker
C. The original principal broker
D. The owner
72) Which of the following regulatory restrictions is false regarding to time-share advertising?
A. Time-share advertising does not have to be registered with the Commission.
B. Advertising may not be false or misleading
C. Advertising may not lead one to believe the number of remaining units is limited or time is “running out” unless supported by clear facts
D. Advertising cannot purport misleading promises of profit or appreciation or impending price increases
73) If a third party company is closing a transaction, the principal broker or executive broker must
A. provide closing instructions to the third party closer.
B. follow closing instructions provided by the third party.
C. pay reasonable fees for the closing from the commission proceeds.
D. attend the closing in person to assure contract compliance.
74) An executive broker knew another broker was dealing independently of his employing broker. Here, the executive broker
A. may not disclose the activity to any party.
B. must report the activity to the Commission.
C. is also guilty of illegal practice.
D. is not required to do anything.
75) The principal broker may delegate supervisory authority to
A. any broker licensee.
B. an associate broker.
C. an executive broker.
D. a salesperson.
A principal broker may delegate supervisory authority to an executive broker that will enable the executive broker to sign offer and acceptance forms, train and supervise licensees, and sign and handle transfer documents.
76) Reasonable cause” for a referral fee is where
A. a referral claim takes place prior to an offer.
B. a referral claim takes place prior to closing.
C. an introduction took place during “substantive discussions”
D. “an actual introduction” took place.
77) Offers and acceptances must
A. be approved by the Commission.
B. be signed.
C. be under oath.
D. be oral.
78) Offers received by selling agents must be presented
A. to the listing firm.
B. directly to the seller.
C. directly to the buyer.
D. Offers do not have to be presented to any party.
Offers received by selling agents must be presented to the listing firm by the close of the following business day.
79) Trust fund reconciliations records must be kept
A. for 1 year.
B. for 3 years.
C. for 5 years.
D. as long as the trust fund is open.
80) Which of the following is an acceptable circumstance for disbursing trust funds?
A. Upon filing of an interpleader action and subsequent court instructions
B. Upon filing of an estoppel by either principal party
C. Upon filing of a civil action by a third party
D. Immediately preceding a closing
81) A licensee has reason to believe that a seller is under contract with another firm. In this case, the licensee
A. may not contact the seller to solicit a listing, whether he was aware of the agreement or not.
B. must determine the listing status with the listing firm prior to making contact.
C. may not contact the seller under any circumstances, or for any reason.
D. may solicit a listing, provided it does not commence prior to expiration of the current listing.
82) First, if you think it is okay to sell real estate on the side without a license, what level of crime will you be charged with?
83) What about a corporation? Can it be charged, and, if so, with what?
84) If a licensee discovers an unlicensed person brokering real estate, what can he or she do about it?
85) What if unlicensed Joe loses unlicensed Mary’s earnest money deposit? What can Mary do?
86) What if seller Peter refuses to pay salesperson April’s commission? What action can April take?
87) What if buyer Jerry is damaged by salesperson April’s incompetence or negligence? What action can Jerry take?
88) The Commission can impose a number of penalties upon a licensee found guilty of a license law violation. What are they?
89) Which of the following is an authorized penalty for a violation of license laws?
A. License suspension
B. Temporary license revocation
C. Denial of a renewal
D. All of the foregoing
90) If the licensee has not paid the awarded damages within 30 days, the Commission may pay the amount of the damages from
A. the Real Estate Damages Trust.
B. the Real Estate Super Fund.
C. the Real Estate Super PAC.
D. the Real Estate Recovery Fund.
91) Violators of Arkansas real estate license law who are officers of a corporation or partnership
A. are protected from lawsuits.
B. are subject to prosecution as individuals.
C. can be forced to cease and desist but cannot be sued for damages.
D. are subject to the laws of the state in which the business is headquartered.
92) Which of the following is a violation of license law?
A. A licensee selling her own home
B. Paying a commission to an unlicensed auctioneer
C. Selling a house to a licensee without a license
D. Being paid a referral fee
93) Once damages are paid to an aggrieved party for a license law violation, the parties
A. may proceed to sue the licensee in court.
B. may sue the Commission for complicity.
C. may sue the Commission for oversight negligence.
D. must assign all claims against the licensee to the Commission.
94) An executive broker is wrongfully cut out of a commission on a transaction. What can this broker do?
A. Sue the principal for the commission
B. Nullify the transaction
C. Sue his principal broker
D. Sue both his principal broker and the principal party
95) An investigated complaint that is deemed to lack merit
A. is nevertheless scheduled for a hearing.
B. is dismissed.
C. may be appealed within 30 days.
D. releases the accused licensee from any further exposure to liability.
96) Any licensee whose license is revoked must wait __________ to apply for a new license.
A. 6 months
B. 1 year
C. 2 years
D. 3 years
97) Practicing real estate without a license in Arkansas is classified as a
A. Class A Felony.
B. Class D Felony.
C. misdemeanor.
D. capital misdemeanor.
98) Parties who may have been damaged by unlicensed persons performing real estate services
A. cannot sue the unlicensed party.
B. can sue the unlicensed party according to Section
C. can sue the unlicensed party according to Section 106 of the license law.
D. can only sue the unlicensed party in a district court.
99) Once damages are paid to an aggrieved party for a license law violation, the parties
A. may proceed to sue the licensee in court.
B. may sue the Commission for complicity.
C. may sue the Commission for oversight negligence.
D. must assign all claims against the licensee to the Commission.
100) Any appeal of a ruling must be filed within __________ from the ruling date.
A. 15 days
B. 3 months
C. 1 year
D. 5 years
101) The Commission will investigate a complaint
A. following receipt of the licensee’s answer to the complaint.
B. following receipt of the complaint, its answer, and the hearing.
C. at any time after its receipt.
D. immediately following the criminal background check of the licensee.
102) Which of the following is NOT a prohibited act?
A. Acting on behalf of more than one party in a transaction if all parties are informed
B. Practicing real estate without a license
C. Dealing independently
D. Accepting compensation for real estate services from anyone other than the principal broker
103) What section of the license law empowers the Commission to bring court action against any party suspected of violating license law for the purpose of forcing the party to discontinue the suspected violation?
A. Section 1
B. Section 107
C. Section 17
D. Section 106
104) What is the critical difference between a listing agent’s disclosure requirement and a buyer agent’s disclosure requirement?
A. The listing agent must disclose upon “first substantive contact” and the buyer’s agent must disclose immediately upon first contact.
B. The buyer’s agent must disclose upon “first substantive contact” and the listing agent must disclose immediately upon first contact.
C. There is no difference in the disclosure requirement.
D. The listing agent does not have to disclose and the buyer’s agent must disclose upon “first substantive contact.”
105) Licensee Louis renders a number of ministerial services to a buyer customer. In this case, Louis
A. has violated his fiduciary duties owed his client.
B. must disclose his performed tasks to his principal.
C. has performed acceptably in view of his fiduciary obligations owed his client.
D. has violated his obligations owed this buyer.
106) A licensee is acting under the delegated authority of the agent is known as a
A. transaction broker.
B. subagent.
C. dual agent.
D. single agent.
107) Which of the following is NOT a fiduciary duty owed to sellers and buyers?
A. Loyalty
B. Confidentiality
C. Full disclosure
D. Friendship
108) The cornerstone of single agency is that the agent
A. owes the principal fiduciary duties.
B. is bound under all cases to abide by the directives of the principal.
C. must treat customers and clients the same.
D. must treat customers as fiduciaries.
109) ___________ is the one duty that extends beyond the expiration of the listing agreement.
A. Loyalty
B. Confidentiality
C. Diligence
D. Full disclosure
110) You are a buyer’s agent who has encountered a represented seller. Do you have to disclose your agency relationship, and, if so, when?
A. You don’t, since you are a buyer’s agent
B. Yes, you must disclose before you submit an offer
C. Yes, you must disclose before you enter any substantive discussions
D. Yes, you must disclose immediately
111) A licensee must make agency disclosure “in a timely manner” which is considered to be when?
A. Before a buyer agent first encounters a listing agent in person
B. When a listing agent first meets a buyer in person
C. Before a listing agent begins to ascertain a buyer’s confidential information
D. When a buyer begins to complete an offer
112) A cooperating licensee from another firm brings a buyer to the listing agent. In this case, the cooperating licensee is
A. representing the buyer.
B. representing the seller.
C. representing the listing agent.
D. representing the principal broker of the listing firm.
113) In a dual agency transaction, the licensee
A. may receive compensation from either party.
B. may receive compensation from the buyer.
C. may receive compensation from both parties.
D. may only receive compensation from the principal broker.
114) A common form of dual agency is where
A. a licensee practices transaction brokerage.
B. a licensee represents a buyer and a seller in the same transaction.
C. a licensee represents a seller as a subagent for another brokerage.
D. a licensee represents a buyer as a subagent for another brokerage.
115) Licensees who fail to disclose their agency relationship properly and in a timely fashion are
A. acting unethically but not illegally.
B. in violation of license law and subject to various penalties.
C. acting in the best interest of the real estate community.
D. involved in subagency.
116. John places an ad to rent his apartment. He includes the disclosure that he is a licensee. Is this acceptably sufficient according to law?
A. Yes, John must include this disclosure.
B. Yes, since he is renting his own property.
C. No, since he omitted the name of the firm.
D. No, since he failed to include the name of his principal broker.
117. The Commission may investigate a license law violation
A. Only upon the filing of a complaint.
B. Upon completion of a hearing.
C. On its own behalf if deemed warranted.
D. The Commission may not investigate violations.
118. One problem with subagency is that
A. Principals refuse to pay them.
B. Subagents increase the principal broker’s liability.
C. It is frequently unclear as to who has earned the commission.
D. Subagents have no fiduciary obligations to anyone
119. A corporate officer advertises to sublease the corporation’s warehouse through his unaffiliated brokerage company. Here, the officer
A. Is exempt from licensure.
B. Is exempt, provided the proper disclosures are made.
C. Is exempt from licensure if no fee is involved.
D. Must be licensed.
120. Which of the following is true?
A. All licenses must be displayed in all offices of a brokerage.
B. Only the principal broker’s license must be displayed in all offices.
C. All licenses must be displayed in the broker’s principal place of business.
D. The principal broker need not display all of the firm’s licenses.
121. A licensee options a property on behalf of the principal broker of another firm. This illegal practice is called
A. Independent dealing.
B. Practicing without a license.
C. Self dealing
D. Co-representation.
122. The purpose for having a buyer sign the “Agency Representation Disclosure” form is to
A. Obtain the buyer’s acknowledgement of the agency relationship.
B. Certify that the buyer and seller have agreed to the dual agency agreement.
C. Confirm that the buyer is willing to participate in payment of the agent’s compensation.
D. Eliminate liability for events that may unfold during the transaction.
123. All salespersons licenses expire
A. One year after renewal.
B. Two years after renewal.
C. At the end of the calendar year.
D. At the end of every odd calendar year.
124. Complaints that are dismissed without a hearing
A. May be appealed within 30 days.
B. May be appealed within 60 days.
C. May not be appealed at all.
D. May be appealed after a 30-day due diligence period.
125. A listed property has a serious leak in the roof, which has caused discolorations in the ceiling. Which of the following is true?
A. The listing agent must abide by the seller’s wishes to conceal this fact.
B. The listing agent should be aware of this condition.
C. The listing agent should require the seller to fix the leak.
D. The listing agent is better off not knowing about the leak.
126. Which of the following is true?
A. An active licensee may voluntarily convert to inactive status.
B. An inactive license is revoked if it is not renewed.
C. An active license that is not renewed becomes a suspended license.
D. An active license can only become inactive through a failure to renew.
127. A licensee attempts to get a principal to cancel a listing in order to get a referral fee through another party. This is the practice of
A. Legal but unethical dual agency.
B. Illegal relationship interference.
C. Legal but unethical relationship interference.
D. Illegal commission tampering.
128. An Arkansas broker applicant must have how much experience as a salesperson?
A. None.
B. 1 year.
C. 2 years.
D. 3 years.
129. The Commission has heard and ruled on an alleged violation of license laws. Which of the following is true?
A. The ruling may be appealed if filed within 15 days.
B. The ruling may be appealed if filed within 30 days.
C. The ruling may be appealed if filed within 60 days.
D. The ruling is final and may not be appealed.
130. Which of the following is true?
A. Licensees may re-take the state examination one time within six months following license issuance.
B. Licensees may re-take the state examination twice within one year following license issuance.
C. Licensees may re-take the state examination one time as a substitute for the initial continuing education requirement.
D. Licensees may not take the state examination.
131. In order to reactivate an inactive license, licensees must
A. Wait until the expiration date, then renew according to Commission procedure.
B. Apply for a temporary license pending receipt of an active license from the Commission.
C. Follow Commission procedures and pay the required fee.
D. Inactive licenses cannot be reactivated.
132. What is the operative rule with respect to agency disclosure in a dual agency situation?
A. To disclose your dual agency status to both parties upon initial contact.
B. To disclose your dual agency relationship upon first substantive contact.
C. To follow the same rules set forth for disclosing buyer agency and seller agency.
D. Never enter a dual agency situation without written approval of the principal broker.
133. A broker landlord leases an apartment to a tenant. In this case the broker
A. Must disclose he is a licensee immediately.
B. Must disclose his licensed status prior to signing the lease.
C. Must not disclose his licensed status at any time.
D. Is not required to do anything.
134. A cornerstone of a fiduciary relationship is that the agent must demonstrate loyalty and
A. Obedience.
B. Obedience, provided the directives are practical and feasible.
C. Obedience, provided the directives are legal.
D. Obedience, provided the directives are not counter to the buyer’s interests.
135. What is the proper form and timing of dual agency disclosure in Arkansas?
A. In writing by both parties prior to substantive communications.
B. In writing by both parties prior to signing any transaction-related document.
C. In writing by both parties prior to signing an offer or sale contract.
D. In writing by both parties prior to closing.
136. A central duty of dual agents is to
A. Avoid actions which will damage one party to the benefit of the other.
B. Promote compromise between both parties in negotiating selling terms.
C. Avoid disclosures that will disadvantage either party.
D. Disclose all confidentialities to either buyer or seller.
137. Which of the following activities requires a real estate license?
A. A person claiming to be an expert auctioneer.
B. An attorney-in-fact acting under a power of attorney.
C. A resident manager leasing the apartment adjacent to her own.
D. A trustee in bankruptcy acting under a court order.
138. A broker’s office signage
A. Must not be permanently attached to the office structure.
B. Must bear the principal broker’s name.
C. Must indicate the business is real estate related.
D. Must be of a specified size.
139. A licensee who witnesses and is damaged by an unlicensed person practicing real estate is entitled to
A. Institute criminal proceedings against the violator.
B. Seek recompense from the Real Estate Recovery Fund.
C. A hearing before the Commission.
D. File an interpleader action with the court.
140. Which of the following best characterizes the makeup of the Arkansas Real Estate Commission?
A. Three members who are licensees and two who are non-licensees.
B. Four members are non-licensed citizens, and three are active licensees.
C. Five members are licensees, and four members are consumers.
D. Three members are citizens-at-large, and two are licensees.
141. Trust funds must be deposited within which time frame?
A. No later than 3 days following execution of a contract or per principals’ instructions.
B. No later than 7 days following execution of a contract or per principals’ instructions.
C. No later than 3 days following receipt by the principal broker.
D. No later than 7 days following receipt by the principal broker.
142. Is it necessary for a listing agent to disclose her agency relationship in writing.
A. No, that is only required of buyer agents.
B. No, verbal representation is sufficient.
C. Yes, it must be in writing at first substantive contact.
D. Initially, no, but a verbal disclosure must be followed up with a written disclosure.
143. How does an associate broker license differ from a salesperson’s license?
A. The associate broker is authorized to train and supervise if directed by the principal broker.
B. The associate broker is authorized to manage a branch office.
C. The associate broker is both a broker and a salesperson.
D. The associate broker holds a broker’s license.
144. Licensees holding expired licenses may
A. Practice real estate for no more than 7 days following expiration.
B. Not practice real estate.
C. Practice real estate until notice is received of the expired status by the Commission.
D. May practice real estate only if they continue to be employed by a principal broker.
145. Non-licensee Commissioners are selected
A. from the state at large, subject to Senate confirmation.
B. by the Senate.
C. By the House of Representatives.
D. by the Association of Realtors.
146. Which of the following is not an acceptable circumstance for disbursing trust funds?
A. At the closing of a transaction.
B. Per a separate agreement signed by the principals.
C. Per interpretation of the contract authorizing the deposit.
D. Upon receipt of a buyer’s affidavit.
147. Which of the following is not true of time share programs in Arkansas?
A. They must be registered.
B. They are regulated by the Arkansas Commission.
C. Managing agents must be registered.
D. Time share instruments do not cover management or operation functions.
148. Which of the following best characterizes the makeup of the Arkansas Real Estate Commission?
A. Three members who are licensees and two who are non-licensees.
B. Four members are non-licensed citizens, and three are active licensees.
C. Five members are licensees, and four members are consumers.
D. Three members are citizens-at-large, and two are licensees.
149. Trust funds are best defined as
A. Other people’s money.
B. Funds entrusted to a broker in connection with a transaction or service.
C. Conditional funds earned by a broker for future services.
D. A buyer’s deposit for a property purchase.
150. Which of the following is not a requirement for licensure?
A. Majority age
B. Evidence of a high school diploma.
C. Payment of fees.
D. Passing an examination.
151. The Commission consists of how many members?
A. 3
B. 5
C. 7
D. 9
152. Which of the following is true?
A. Once delegated, the executive broker is solely responsible for branch activities.
B. The principal broker may delegate training and trust account responsibility to the executive broker.
C. The principal broker is the only party authorized to sign offer and acceptance forms.
D. The consummation of a transaction must be supervised by the principal or branch executive broker.
153. Which of the following may manage a branch office of a brokerage?
A. The principal broker only.
B. The principal broker or executive broker.
C. The executive broker only.
D. Any licensee with a broker license.
click here for all Q&A on 1page for easier searching
Recommended Real Estate Schools:
Website Trusted and Protected by:
