Which of the Following Statements Is (Are) TRUE of Selling

question 1

Multiple Choice

Which of the following statements is (are) TRUE of selling agents in residential real estate transactions?

• A) Because agents are paid on commission, there is no principal-agent problem.
• B) Agents have an incentive to sell quickly, without waiting for slightly higher offers.
• C) If an agent sells an owner's home for an additional $20,000, the agent stands to gain more than the owner.
• D) Owners know more than agents about the state of the real estate market and the value of comparable homes.

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Definitions:

Accelerated Depreciation

A depreciation method that expenses asset cost more rapidly in the initial period of its life.

Tax Purposes

The specific reasons or considerations for calculations or filings as required by tax laws.

Impairment Tests

Assessments to determine if an asset's carrying amount exceeds its recoverable amount, indicating a loss in value.

Fair Value

A measure of the estimated price at which an asset or liability could be traded in a transaction between willing parties, other than in a liquidation sale.