Federal Law Requires REITs To

question 104

Multiple Choice

Federal law requires REITs to:

• A) distribute at least 90 percent of their earnings to shareholders.
• B) engage in short-term holdings of real estate.
• C) register with the U.S. Department of Housing & Urban Development.
• D) reinvest at least 50 percent of their income in rental properties.
• E) have at least 500 shareholders.

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Definitions:

Bulk Purchasing

The acquisition of goods or products in large quantities, often at a discounted price.

Profit Margins

A financial metric that measures the percentage of profit a company makes for each dollar of sales, indicating how effectively a company is managing its expenses relative to its net sales.

Management Structure

The hierarchical arrangement of lines of authority, communications, rights, and duties within an organization.

Franchise

A business model that allows individuals to own and operate their branch or location of an existing larger brand or business.