The CE Shop Test, Real Estate Final Exam New
Latest Version 2024-2025 with All Questions and
100% Correct Answers
Octogenarians Gertie and Frank met in Sunset Living, a skilled nursing center for people with
advanced Alzheimer's disease, where they're both residents. They fell in love and get hitched,
signing a marriage certificate. This is an example of a(n) ______ contract.
a. Executory
b. Implied
c. Invalid
d. Valid ----------- Correct Answer ------------ c. Invalid
How may the commission specified in a listing agreement legally be changed, according to the
Illinois Real Estate License Act?
a. The agreement may be amended by crossing out the original entry and writing the new
commission amount.
b. The amount is automatically increased by 1% if the commission will be shared with a buyer's
agent.
c. The commission change must be made in writing and signed by the parties to the agreement.
d. The commission may be changed on the purchase agreement, which supersedes the listing
agreement. ----------- Correct Answer ------------ c. The commission change must be made in
writing and signed by the parties to the agreement.
How do licensees use the funnel?
a. To calculate the number of homes sold in an area that the licensee may be able to list
b. To calculate the number of leads required to generate a certain amount of income
c. To calculate the number of transactions to close each year to reach a certain amount of income
d. To sift through leads to find the clients worth spending time on ----------- Correct Answer -----
------- b. To calculate the number of leads required to generate a certain amount of income
When a prospective homebuyer isn't represented, what doesn't she have?
a. An agency agreement
b. A seller's agreement
c. Responsibility to pay the seller's commission
d. The legal right to purchase ----------- Correct Answer ------------ a. An agency agreement
What's a foreclosure?
a. A property sale that occurs in less than one week
,b. A sale that fails to receive a high enough bid at auction and then falls to the bank's ownership
c. The forced sale of a property due to the borrower defaulting on the mortgage loan
d. The sale of a property when the market value of the home is less than what is owed, plus
closing costs ----------- Correct Answer ------------ c. The forced sale of a property due to the
borrower defaulting on the mortgage loan
_______ can be defined as everything that's not real property.
a. Land property
b. Personal property
c. Private property
d. Real estate ----------- Correct Answer ------------ b. Personal property
What are the two categories of comparison when evaluating comparables to a subject property in
the market comparison approach?
a. Broad and specific
b. Components and measures
c. Elements and units
d. General and detailed ----------- Correct Answer ------------ c. Elements and units
Which of the following items must be included in the security instrument used for a real estate
transaction?
a. Borrower credit report
b. Legal description of the property
c. Lender disclosures
d. Title insurance abstract ----------- Correct Answer ------------ b. Legal description of the
property
Which of the following statements best describes a mortgage broker?
a. An institution that focuses on commercial lending
b. An institution that specializes in taking in savings deposits then lends money out as loans and
mortgages
c. A person who works for a specific lender and can offer products from that particular
institution
d. A person who works with multiple lenders to find the product that works best for the client ----
------- Correct Answer ------------ d. A person who works with multiple lenders to find the
product that works best for the client
Appraiser Niles uses ______ to determine a range of values based on comparing a subject
property to comparable sales. He makes sure to use some comparables that lack features of his
subject property, and others that have even more desirable features, to balance out the
comparison.
,a. Bracketing
b. Competition
c. Correlation
d. Substituting ----------- Correct Answer ------------ a. Bracketing
At what point in a residential transaction must a seller's agent deliver a completed Residential
Real Property Disclosure Report to a buyer?
a. At least five days prior to closing
b. Prior to showing the property to the prospective buyer
c. Prior to the parties signing a purchase agreement
d. Within three days after the parties sign a purchase agreement ----------- Correct Answer --------
---- c. Prior to the parties signing a purchase agreement
Which of the following is a residential dwelling with attached walls, where the owner also
typically owns the land on which the home sits?
a. Apartment
b. Condominium
c. Single-family detached home
d. Townhome ----------- Correct Answer ------------ d. Townhome
A ______ is the expected rate of return on an investment.
a. Capitalization rate
b. Cash flow
c. Income ratio
d. Profit margin ----------- Correct Answer ------------ a. Capitalization rate
A borrower makes the same monthly mortgage payment for the entire term of the loan. At the
end of the loan period, all of the interest and principal is paid off. This is known as a ______
loan.
a. Fully amortized
b. Growing equity
c. Negative amortization
d. Reverse annuity ----------- Correct Answer ------------ a. Fully amortized
In Illinois, how are commissions commonly split between the listing brokerage and brokerage
that represents the tenant?
a. 100% to the brokerage that finds the tenant
b. 20% listing brokerage, 80% brokerage that finds the tenant
c. 50% listing brokerage, 50% brokerage that finds the tenant
d. 80% listing brokerage, 20% brokerage that finds the tenant ----------- Correct Answer ----------
-- c. 50% listing brokerage, 50% brokerage that finds the tenant
, Carolyn is representing John in the sale of his home. Which listing agreement clause gives her
additional authority and obligates her to distribute the listing to other brokers?
a. Broadcast clause
b. Broker extension clause
c. Marketability clause
d. Multiple listing clause ----------- Correct Answer ------------ d. Multiple listing clause
_______ are artificial attachments to land that include items such as fencing, buildings, and
walkways.
a. Emblements
b. Encroachments
c. Improvements
d. Levies ----------- Correct Answer ------------ c. Improvements
Violators of the Sherman Antitrust Act may be subject to fines. For what amount may
corporations and individuals be liable?
a. Up to $100,000 for corporations and $1,000 for individuals
b. Up to $100 million for corporations and $1 million for individuals
c. Up to $10 million for corporations and $1 million for individuals
d. Up to $1 million for corporations and $100,000 for individuals ----------- Correct Answer ------
------ b. Up to $100 million for corporations and $1 million for individuals
What happens to a joint tenant's share of property when the joint tenant dies?
a. The joint tenant's interest goes to the remaining joint tenants. If only one joint tenant is left,
that joint tenant owns the property in severalty.
b. The property must be sold, with the proceeds from the joint tenant's share distributed to heirs.
c. The tenancy remains, but the joint tenant's interest passes to heirs.
d. The tenancy terminates, and the joint tenant's share goes to the state. ----------- Correct Answer
------------ a. The joint tenant's interest goes to the remaining joint tenants. If only one joint
tenant is left, that joint tenant owns the property in severalty.
You helped Frasier buy his penthouse condo. He's just received the keys and you two have said
your goodbyes after closing, and you're heading back to the office to close out the transaction
file. Which of your fiduciary duties continue?
a. Accounting and loyalty
b. Confidentiality and accounting
c. Confidentiality, loyalty, and accounting
d. Reasonable skill and care, confidentiality, and loyalty ----------- Correct Answer ------------ b.
Confidentiality and accounting
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