Real Estate Finance – 7th Edition
Chapter 2 Quiz
By Walt Huber, MS and Levin P. Messick, IFAC
© April 2009, Educational Textbook Company
1. In a seller’s market:
a. supply exceeds demand.
b. demand exceeds expectations.
c. home prices decline.
d. none of the above.
2. The four phases of the business cycle are:
a. peak, expansion, bottom, recovery.
b. peak, depression, bottom, expansion.
c. trough, recession, bottom, recovery.
d. peak, recession, bottom, recovery.
3. A loss of savings deposits to higher yielding competitive investments is referred to as:
a. deficit savings.
b. disintermediation.
c. pass-through deposits.
d. mediation investing.
4. The study and description of the population of an area is called:
a. regentrification.
b. demographics.
c. psychographics.
d. demonstrative study.
5. Predatory loan practices include:
a. fraud.
b. usury.
c. deception.
d. all of the above.
6. When prices begin to fall and production tapers off, the period is called a:
a. low economy.
b. seller’s market.
c. buyer’s market.
d. balanced market.
7. When the government is forced to borrow money, making less money available for construction and home loans, it is called:
a. deficit spending.
b. government spending.
c. predatory loan practices.
d. disintermediation.
8. The degree of risk in a real estate loan:
a. can be controlled by qualifying a buyer and a property before a loan is made.
b. refers to the likelihood of default by the borrower.
c. refers to the ability of the lender to recover loan proceeds through foreclosure.
d. all of the above.
9. The role of FNMA (Fannie Mae) was further expanded in 1970 with the passage of the:
a. Federal National Mortgage Act.
b. Urban Development Act.
c. Emergency Home Finance Act.
d. none of the above.
10. A real estate cycle refers to the real estate market’s reaction to the forces of:
a. supply and demand.
b. war and peace.
c. give and take.
d. deposits and withdrawals.
Real Estate Finance – 7th Edition
Chapter 2 Quiz Answers
© April 2009, Educational Textbook Company
1. d (p. 31)
2. d (p. 27)
3. b (p. 32)
4. b (p. 34)
5. d (p. 35)
6. c (p. 31)
7. a (p.35)
8. d (p. 37)
9. c (p.39)
10. a (p.27)
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