REAL ESTATE FINANCE Existing Use

Most Probable use that are legally and

physically possible and provides the highest
5. The value of real estate is determined in the financial returns
market mainly by its: Immediate Next Use
Price Ordinary and Necessary Use
Size
Mortgage A sale between relatives is suspected to be:
Productivity An arm's length sale
A seller-financed sale
A value estimate is a: A sale made at a distorted price
Prediction that property will sell for exactly the A bona fide sale
amount named
Projection or extrapolation of historic price to When one or two parcels are consolidated so
future price that its increment in value as whole is much
Estimate of a Selling Price more than the total sum of the value of each
Sophisticated Guess by Expert parcel of land separately owned is called
_________.
Price and Value are: Cost Value
Not necessarily the same Market Value
Synonymous Economic Value
Different, depending on Financing Terms Plottage Value
Close together in an inactive market
Value is created and sustained by the
Market Price is the amount for which a property: interrelationship of four factors namely:
Was Sold Utility, Location, Desire, Size
Should Sell Utility, Desire, Scarcity, Purchasing Power
Could Sell Location, Shape, Area, Scarcity
Will Sell Location, Use, Size, Area

Which type of studies test the ability of various _________ is the amount that has been asked,
proposed improvements to meet investment offered, or paid for the item.
objectives? Value
Cost-Benefit Cost
Feasibility Market Value
Market Price
Marketability
Appraisal is:
To estimate market value, an appraiser follows The act or process of developing an opinion
the: of value
Appraisal Guidelines A lucrative profession
Valuation Process The report conveyed to the client
Appraisal Report The act or process of telling the Client the
Evaluation Methodology market value of the property

Residential Appraisers generally provide an

estimate of: 36. Appraisal is:
Market Price The act or process of developing an opinion
Assessed Value of value
Cash Value A lucrative profession
Market Value The report conveyed to the client
The act or process of telling the Client the
In preparing an appraisal, definition of the market value of the property
assignment identifies all of the following except:
The Highest and Best Use for the Property 37. An Appraiser:
The Real Property Right Determines Values
The Real Estate being Appraised Determines Price
The Date of the Value Estimate Measures and Develops an opinion of value
Determines Cost
The criteria for determining highest and best use
include all of the following, except: 38. The principle of substitution implies that the
Legal Permissibility value of a/an ____________ property tends to
Financial Feasibility be indicated by the value of an equally desirable
Effect on Community welfare property.
Physical Possibility Comparable
Appraised
The highest and best use of a site is its: Repairable
Replaceable
 70. Those assets which are not physical and
39. Which of the following is not included in material in nature are called:
estimating replacement cost? Tangible Assets
Building and Fixture Fixed Assets
Component of the original Building Intangible Assets
Judgment as to attractiveness and utility of Liquid Assets
the structure
Cost of Labor
28. On matters of Integrity, the Real Estate
The term non-homogeneity refers to: Appraiser shall, except:
Indestructibility Act legally and comply with the laws and
Scarcity regulations of the State or Country where he/she
Immobility practices the appraisal profession or where the
Uniqueness appraisal work or assignment is to be
undertaken.
64. The process of making an estimate of value Not act in a manner that is misleading or
of any asset/property in accordance with the ambiguous
generally accepted standards on a given date: Not contribute or participate in providing
Appraisal appraisal professional service that other Real
Value in Use Estate Appraiser(s) would consider unjustifiable
Value in Exchange or unacceptable.
Valuation Perform an appraisal work or assignment
with the strictest independence, objectivity,
65. It is the process of determining monetary and impartiality without giving any undue
values of the property rights encompassed in an advantage preference to one’s personal
ownership at some specific time/period. interest.
Valuation
Appraisal 29. On matters of Impartiality, the Real Estate
Value in Use Appraiser shall:
Value in Exchange Not use or depend on unsupported
conclusion(s) based on biases of reported
66. It indicates the value of the property traded conclusion(s).
in the market which is referred to as market Not act for two or more parties/clients in the
value. same matter or Subject, except with the
Appraisal written consent of the concerned parties.
Value in Use Not rely on critical information supplied by the
Value in Exchange client or any other party without appropriate
Valuation authentication or confirmation from an
independent source unless the nature and
67. The highest amount in terms of money that a extent of such reliance are specified as a limiting
property should bring given reasonable time condition(s).
exposure in the open and competitive market. Not accept any appraisal work or assignment
Fair Market Value that includes reporting of predetermined
Salvage Value opinions and conclusions of the Subject’s
Market Value estimated value.
Zonal Value 30. At all times, deal with the client’s affairs with
sound judgment, proficiency, and confidentiality.
68. The highest price estimated in terms of
Integrity
money that a real property is acquired by a
Confidentiality
buyer who is willing to buy and a seller who is
Competence
willing to sell but is not obliged or anxious to sell;
Impartiality
both of whom have adequate knowledge of the
actual and potential use of the property offered 31. Possess the knowledge, skills, and
for a reasonable time in the open market and experience(s) to efficiently complete the
neither parties under pressure to buy or sell. appraisal work or assignment relative to an
Value in Use acceptable appraisal professional standard.
Valuation
Value in Exchange Only those Real Estate Appraisers who conform
Market Value to the definition of the licensed Real Estate
Appraiser under Section 3(g) subparagraph (2)
69. The element of value include which of the
and (3) of R.A. No. 9646 shall undertake the
following:
appraisal work or assignment in connection with
Competition
the Standards of Appraisal Professional
Anticipation
Practices.
Balance
Accountability
Scarcity
Integrity
Disclosure
Competence
32. On matters of Competence, the Real Estate
Appraiser shall:
Not make any departures from the Standards
of Appraisal Professional Practices, which
are devised for situations in general and
does not cater to every eventuality or
situation.
Act promptly and efficiently in carrying out the
client’s instructions and should keep the client
informed of his/her work progress.
Secure or obtain written instruction(s) from the
client and written confirmation by the Real
Estate Appraiser in sufficient details before the
start of the appraisal work or assignment to
avoid any misinterpretation.
Establish first that the person(s) assisting has
the necessary or the required skills and ethical
standards when engaging the services of
outside assistance necessary to complement
his/her skills.

38. The Market Value should be ______.

Location-based
Appraisal-based
Market-based
Economics-based
 Utility
1. The manner in which a client intends to use Desire
the data in an appraisal report. Scarcity
Relevance of a Valuation Supply
Purpose of a Valuation
Highest and Best Use of aValuation 10. The capacity of a person or a group to
Intended Use of a Valuation engage in market activity.
Demand
2. To form an opinion of the estimated value of a Purchasing Power
real estate interest or to carry out research Suffrage
regarding real estate decisions. Wealth
Purpose of a Valuation
Relevance of a Valuation 11. It is a set of principles that govern how the
Intended Use of a Valuation value of a property is determined.
Highest and Best Use of aValuation Appraisal Principles
Value Theory
3. Market Value is the estimated amount for Valuation Conduct
which an asset or liability _______ exchange on Valuation Process
the valuation date between a willing buyer and a
willing seller in an arm's length transaction. 12. _________ are mostly unlicensed real estate
Must appraisers who work for appraisal companies,
Could banks, financial institutions, and insurance
Should companies, among other companies.
Will Government Appraisers
Colorum
4. A concept based on the productivity of a Fee Appraisers
property and focuses on its specific use. Institutional Appraisers
Market Value
Use Value 13. Appraisal work must be comprehensive,
Value in Exchange carefully detailed, fair, and based upon sound
Fair Value judgment. All work must be carefully prepared
and reviewed.
5. It represents the value of a specific property Quality of Work
to a particular investor. It is the price an investor Impartiality
would pay for an investment in light of its Integrity
perceived capacity to satisfy that individual's Competence
desires, needs, or investment goals.
Asset Value 14. ______ is the foundation for all social and
Utility Value economic activities. It is a tangible asset and a
Investment Value source of wealth.
Business Value Value
Land
6. An established and operating business with Money
an indefinite future life. Valuation
Going Concern
Goodwill 15. It is the ______ who will determine a real
Economic Life property valuation's purpose and intended use.
Assessed Value Client
Appraiser
7. Assessors does not have full authority in Market
assessing specific real estate properties since Valuer
the Philippine Constitution and the Local
Government Code mention ___________. 16. Legal matters of concern to appraisers
Equity in Assessment include the following, except:
Uniformity in Assessment Recording and Transfer of Titles
Justice in Assessment Obsolescence
Universal Assessment Property Assessments
Easements
8. A property's ability to satiate a human need,
want, or desire. Without this, a piece of real 17. Which of the following statements is/are
estate cannot be considered valuable. true?
Utility
Satisfaction Factor I. Utility, Scarcity, Desire and Purchasing Power
Desire are factors that create real property values
Scarcity
II. Government/Legal, Economic, Social, and
9. The present or anticipated supply of an item Geographic/Environmental forces affect real
in relation to the demand for it. estate property values
III. Desire and Purchasing Power are Demand 24. Which of the following factors has the
Factors greatest impact on the market value of a
commercial property?
IV. Utility and Scarcity are Supply Factors
I and II only The proximity to popular tourist attractions
I, II, and III only The rental income generated by the property
I, II, III, IV The aesthetic appeal of the building's
I and IV only architecture
II, III, and IV only The quality of nearby schools and educational
Correct answer institutions

18. When an opinion of value is needed in a 25. When appraising the market value of a
valuation, the type of value required must be unique and unconventional property, which
defined _________. approach is typically considered the most
Before Site Inspection reliable?
During the Negotiation Phase Regression analysis approach
At the Beginning of the Valuation Process Income approach
Before Valuation Assignment Acceptance Cost approach
Sales comparison approach
19. The purpose and intended use of a valuation
are: 26. In a rapidly growing real estate market, how
Dependent on the assignment does an increase in demand typically affect the
Slightly different but similar concepts market value of properties?
One and the same concepts Market value increases due to limited supply
Related but have different concepts and high demand
Market value fluctuates randomly and is not
20. Which of the following is the best way to influenced solely by demand
determine the market value of a property? Market value remains unaffected by changes in
Compare the property to similar properties demand
that have recently sold. Market value decreases as a result of excessive
Use the income approach to value the property. supply and low demand
Estimate the cost of building a similar property.
Add up the value of the land and the value of the 27. Which of the following factors has the most
improvements. significant impact on the price of residential
properties?
21. When determining the price of a property, The average income level of the neighborhood
which of the following is NOT typically residents
considered? The presence of high-quality schools in the
The personal preferences of the property vicinity
owner Consumer sentiment and economic
The current market conditions conditions
The condition and age of the property The size of the property's backyard
The cost of any recent renovations or upgrades
28. When assessing the cost of a property,
22. Which of the following factors contributes to which of the following expenses is considered
the cost of a property? an external cost?
The amount of mortgage interest paid over time The cost of repairs and maintenance
The property's market value The property taxes paid by the owner
The expenses associated with property The property's mortgage interest
maintenance and repairs The environmental impact of the property's
The price at which the property was sold in the location
past
29. When appraising the market value of a
23. What is the primary difference between historic property, which approach is typically the
market value and price? most challenging to apply accurately?
Market value is a fixed amount, while price can Sales Comparison Approach
vary based on negotiation and market
conditions. Income Approach
Market value is the historical value of a property, Residual Approach
while price is the current value in the market. Cost Approach
Market value is determined by a certified
appraiser, while price is negotiated between the 30. Which of the following factors is NOT
buyer and seller. typically considered in the cost approach to
Market value represents the worth of a determine the value of a commercial property?
property in the eyes of potential buyers, Depreciation of the property
while price is the amount actually paid by the Cash flow generated by the property
buyer. Land value
Construction materials used Capitalized Value = P100,000 / 0.08 =
P1,250,000
31. What is the term used to describe the
economic principle that states the maximum Next, we subtract the estimated land value from
value of a property is typically achieved when the capitalized value to find the value of the
the cost of creating or acquiring an equally improvements:
desirable substitute is approximately the same?
Principle of anticipation Estimated value of improvements = Capitalized
Principle of substitution Value - Land value = P1,250,000 - P500,000 =
Principle of conformity P750,000
Principle of contribution
Therefore, the estimated value of the property's
32. Which of the following statements best improvements is P750,000.
describes the concept of "plottage" in real estate
appraisal? 36. What is the term used to describe a type of
The decrease in value due to functional depreciation that occurs due to factors outside
obsolescence the property itself, such as changes in the
The cost of removing a structure from a property neighborhood or surrounding area?
The increase in value resulting from Obsolescence
combining adjacent parcels of land Physical depreciation
The loss in value due to external factors such as Functional depreciation
noise pollution External obsolescence

33. A property is appraised using the cost 37. A property is appraised using the cost
approach. The appraiser estimates the cost to approach. The replacement cost of the building
replace the building at P400,000. The land is is estimated to be P1,000,000. The effective age
worth P100,000. The appraiser estimates the of the building is 20 years, and its total economic
amount of depreciation to be P50,000. What is life is estimated to be 50 years. What is the
the estimated market value of the property? estimated accrued depreciation for the building?
P 550,000
P 450,000 P 200,000
P 500,000 P 400,000
P 250,000 P 500,000
P 600,000
34. A property is appraised using the income Feedback
approach. The appraiser estimates the net To find the estimated accrued depreciation for
operating income (NOI) to be P50,000 per year. the building using the cost approach, we
The appraiser uses a capitalization rate of 10%. calculate the depreciation as a percentage of the
What is the estimated market value of the replacement cost.
property?
P 550,000 Accrued depreciation = (Effective age / Total
P 500,000 economic life) * Replacement cost
P 55,555.55
Accrued depreciation = (20 / 50) * P1,000,000 =
P 55,000 P400,000
35. A property is appraised using the residual
Therefore, the estimated accrued depreciation
approach. The expected net operating income
for the building is P400,000.
(NOI) for the property is projected to be
P100,000 per year. The required rate of return is 38. When using the sales comparison approach,
8%, and the estimated land value is P500,000. which of the following adjustments is typically
What is the estimated value of the property's made for a comparable property that has a
improvements? larger square footage than the subject property?
P 875,000 No adjustment
P 500,000 Adjustment depends on other factors
P 625,000 Positive adjustment
P 750,000 Negative adjustment
Feedback 39. What is the term used to describe the
To find the estimated value of the property's process of estimating the value of a property by
improvements using the residual approach, we examining its historical income and expense
first calculate the capitalized value of the net data, as well as the income potential of similar
operating income (NOI). properties?
Cash-on-cash return
The formula is: Capitalized Value = NOI / Capital expenditure analysis
Required Rate of Return. Income capitalization approach
Gross rent multiplier
40. A commercial property generates an annual If the interest rate is zero, then both options are
net operating income (NOI) of P200,000. The equally valuable.
estimated capitalization rate is 7.5%. What is the
estimated value of the property using the direct However, if the interest rate is positive, then
capitalization method? Option B is more valuable than Option A. This is
P 2,000,000 because the future value of Option B will be
P 2,666,667 greater than the present value of Option A, due
P 2,666,666 to the interest earned.
P 3,000,000
For example, if the interest rate is 5%, then the
Feedback future value of Option B will be P126,000 in one
Estimated Value = NOI / Capitalization Rate year. This is greater than the present value of
Estimated Value = P200,000 / 0.075 Option A, which is P100,000.
Estimated Value = P2,666,666.667 or
P2,666,667 (rounded off) 43. You want to have P100,000 in five years.
How much money do you need to invest today if
Note: The rule of thumb for rounding off the interest rate is 7%?
numbers is to round off to the nearest whole P71,298.61
number if the decimal is less than 0.5, and to the P75,000
next highest whole number if the decimal is P82,000
greater than or equal to 0.5. P85,306.05
Feedback
In this case, the decimal is 0.667, which is Present Value = Future Value / (1 + Interest
greater than or equal to 0.5. Therefore, the Rate)^Number of Periods
number should be rounded off to the next
highest whole number, which is P 2,666,667. Present Value = 100,000 / (1 + 0.07)^5
Present Value = 100,000 / 1.40255
41. A 4-unit apartment building has a net Present Value ≈ P71,298.617
operating income (NOI) of P120,000 per year.
The appraiser uses a cap rate of 10% to 44. Property rights conveyed adjustments in the
estimate the market value of the property. sales comparison approach are used to
However, the appraiser is concerned that the compensate for differences:
cap rate for similar properties in the area may be In the financing terms included with the
closer to 12%. What is the range of possible comparable sales
market values for the property? In the ages of improvement of the subject and
P 1,200,000 to P 1,440,000 the comparable sales
P 1,680,000 to P 1,920,000 In the locations of the subject and the
P 1,000,000 to P 1,200,000 comparable sales
P 1,440,000 to P 1,680,000 In the rights in realty of the subject and the
comparable sales
Feedback
Lower Cap Rate: 45. The percentage of gross adjustment in the
Market Value = NOI / Cap Rate sales comparison approach is:
Market Value = P120,000 / 0.10 A. The sum of the absolute values
Market Value = P1,200,000 (regardless of sign) of the adjustments as a
percentage of the gross sale price
Higher Cap Rate: B. The net amount adjustment (considering the
Market Value = NOI / Cap Rate signs) based on a percentage of the gross sale
Market Value = P120,000 / 0.12 price
Market Value = P1,000,000 C. The final value opinion divided by the value
conclusion derived in the sales comparison
The range of possible market values for the approach
property is between P1,000,000 and D. The gross sale price divided by the average
P1,200,000. adjustment rate

42. You are offered the following two options: Feedback

The answer is (a). The percentage of gross
Option A: You will receive P100,000 today. adjustment in the sales comparison approach is
the sum of the absolute values (regardless of
Option B: You will receive P120,000 in one year. sign) of the adjustments as a percentage of the
Which option should you choose? gross sale price. This is a measure of how much
the adjustments have changed the value of the
Option B, because it has a higher future value. comparable property.
It depends on the interest rate.
Both options are equally valuable. Option (b) is the net amount adjustment, which
Option A, because it is worth more today. considers the signs of the adjustments. Option
Feedback (c) is the final value opinion divided by the value
conclusion derived in the sales comparison
approach. Option (d) is the gross sale price
divided by the average adjustment rate. Instructions: Choose the BEST answer
carefully. There is no penalty for guessing, so be
Here is an example. Let's say we have a sure to answer all questions. Unless otherwise
comparable property that sold for $100,000. We indicated, all questions count equally.
make the following adjustments to the 9 of 50 points
comparable property: "No matter how small the dishonest deed is, at
the end of the day, cheating is cheating."
An adjustment of +P10,000 for a larger lot size.
An adjustment of -P5,000 for a less desirable 51. These are properties which are designed,
location. constructed, and developed for a specific use or
An adjustment of +P2,000 for a newer roof. purpose and by its very nature this type of
property is rarely offered in the open market
The total gross adjustment for the comparable except as part of a going concern.
property is P7,000. Special Assets
Special Purpose Assets
The percentage of gross adjustment is P7,000 / Special Purpose Properties
P100,000 * 100% = 7%. Special Purpose Assets Vehicle

46. The sales comparison approach is based on 52. The Philippine Valuation Standards are
the concept that: intended to facilitate the use and adaptation of
Appraisers can study market participants’ internationally recognized appraisal standards
behavior in the past and draw inferences for:
about future buyer actions based on that Valuation Process
data Valuation Purpose
Buyers can always build a new building instead Taxation Purpose
of buying the subject Appraisal Purpose
Buyers may decide to rent a property in lieu of
buying the subject 53. Under the PVS, in order to promote and
Past market behavior will seldom be replicated preserve the public trust inherent in professional
in future markets appraisal practice, an assessor/appraiser must
observe the highest standards of professional
47. If a comparable sold for P 4,000,000 today ethics.
and prices in this market were decreasing by 5%
per year, what would have been the sale price 3 This standard refers to the:
years ago? Ethical Code and Standards
Valuers Code of Ethics
Use annual, straight line (not compounded) Code of Conduct
calculations. Code of Ethics and Professional Conduct
P 3,400,000
P 4,000,000 54. To perform valuations that comply with these
P 3,478,260 Standards and General Valuation Concepts and
P 4,705,880 Principles (GVCP), it is mandatory that
Appraisers/Assessors adhere to the Code of
Feedback Conduct pertaining to, except:
P 4M/.85 = P 4,705,880 Reporting
Competence
48. It is the study of how to collect, organize, Disclosure
analyze, and interpret numerical information. Integrity
Data Analytics
Data Mining 55. In developing a mass appraisal, an appraiser
Statistics must be aware of, understand, and correctly
Artificial Intelligence employ those recognized methods and
techniques necessary to produce and
49. The best comparable for Market Data communicate credible mass appraisal.
Approach is the sale that
Sold most recently A mass appraisal includes the following except:
Was most proximate Reconciling the Mass Appraisal Results
Required the most amount of adjustments Identifying the property to be appraised
Required the least amount of adjustments Adjusting the differences between the model
and the market comparable
50. Which step of the valuation process is Identifying factors and forces that affect and
“defining the value” a part of? influence value
Definition of the problem
Preliminary analysis and data selection and 56. Mass Appraisal provides for a systemic
collection approach and uniform application of appraisal
Land value opinion methods and techniques to obtain estimates of
Highest and best use analysis
value that allow for statistical review and
analysis of results. Although a distribution of a price value between
land and improvements by statistical ratio can
This requirement recognizes that this principle be useful at times, the procedure has limitations.
which continue to affect the manner in which Anticipation
appraiser perform mass appraisals. Capitalization
Contribution Abstraction
Change Allocation
Highest and Best Use
62. Affirms that value is created by the
Conformity anticipation of future benefits.
Allocation
57. In developing mass appraisal, an appraiser Anticipation
must observe the following specific appraisal Abstraction
requirements, except: Capitalization
Identify Intended Users
Identify the problem and solutions involved 63. The act of estimating the value of a property.
Identify the Purpose and Intended Use of the It is an estimate or opinion of value, usually
Appraisal market value or value as defined by the
Identify the scope of work necessary to appraiser.
complete the assignment, including any special
limiting conditions It is made as of a specific date and is a
conclusion which results from a logical and
58. An extraordinary assumption in Mass orderly analysis of facts.
Appraisal may be used in an assignment only if: Valuation Process
It is required to property develop credible Appraisal Process
opinions and conclusions Valuation
The scope of work is necessary to complete Appraisal
the assignment
The Appraiser has a reasonable basis for the 64. The date as of which the conclusion or
extraordinary assumption opinion rendered in an appraisal is applicable
Use of the extraordinary assumption results in a and valid.
credible analysis Inspection Date
Appraisal Date
59. In reconciling a mass appraisal, an appraiser Report Date
must, except for one: Date of Assignment
Employ recognized mass appraisal testing
procedures and techniques to ensure that Feedback
standards of accuracy are maintained The applicable and valid date for the conclusion
Reconcile the quality and quantity of data or opinion rendered in an appraisal is the
available and analyzed within the approaches Appraisal Date. The Appraisal Date refers to the
used and the applicability or suitability of the specific date on which the appraiser conducted
approaches used the appraisal and arrived at their conclusion
Value sites by recognized methods or regarding the value of the property.
techniques; such techniques include but are
not limited to the sales comparison 65. Based on the PVS, there are only two (2)
approach, allocation method, abstraction values, namely Market Value and:
method, capitalization of ground rent, and
land residual technique Non-Market Value
Fair Market Value
60. A method of land valuation in the absence of Value in Exchange
vacant land sales, whereby improvement values Appraised Value
obtained from the cost model are subtracted
from sales prices of improved parcels to yield 66. A transaction freely arrived at in the open
residual land value estimates. market, unaffected by abnormal pressure or by
Anticipation the absence of normal competitive negotiation
Abstraction as might be true in the case of a transaction
Capitalization between related parties.
Allocation Market Forces
Actual Sale
61. The distribution of the appraised value of the Arm's Length
property between land and building which is Flipping
accomplished on a ratio basis utilizing
percentage breakdowns from comparable 67. Holds that the value is created and
locations by subtracting a figure representing the maintained in proportion to the equilibrium
percentage contribution of buildings to total attained in the amount and location of the
value from total value of the improved property essential uses of real estate.
(100%). Contribution
Surplus Productivity Change
Anticipation Contribution
Balance
75. Under this approach to value, the land is
68. It is the combination of rights associated with appraised as vacant. The land value is then
the ownership of real property. added to the depreciated cost of the
Property improvements to arrive at an indication of value.
Bundle of Rights
Real Estate It is based on the "Theory of Substitution" which
Real Property states that no property is worth more than
replacement cost of a similar property having
equal utility and equally desirable location which
69. A scale map showing the dimensions of can be obtained without undue delay.
each parcel and related information such as Direct Market Approach
parcel identifier, survey lines, and easements. Residual Technique
Cadastral Map Cost Approach
Topographic Map Income Capitalization Approach
Location Map 76. It is loss in value within the property as a
Vicinity Map result of the development of new
technology,changes in design or market
70. It is the process of converting into present preferences.
value a series of anticipated future periodic External Obsolescence
installment of net income. Functional Obsolescence
Physical Obsolescence
In real estate appraising, it usually takes the Obsolescence
form of discounting.
Allocation 77. The right of the government or specified
Anticipation quasi-public bodies, such as public utilities, to
Capitalization acquire private property for public or quasi-
Yield public use upon payment of just compensation.
Jura Regalia
71. A statement that appraisers, in their Condemnation
professional capacity, personally conducted the Eminent Domain
appraisal in an objective manner. Expropriation
Such a statement permits appraisers to state 78. An absolute fee, without any limitation to any
their precise position, thus protecting their particular class of heirs or restrictions, but
integrity and the validity of their appraisals. subject to the limitation of eminent domain,
Appraisal Certificate escheat, policice power, and taxation and is an
Certification of Value inheritable estate.
Appraisal Statement Ownership
Valuation Statement Fee Simple
Equitable Owner
72. Holds that economic, physical, Real Property
governmental, and social forces are constantly
at work and because changes brought by these 79. The value existing in the proven property
forces affect real property, the appraiser view operation, considered as an entity with business
real property and its environment as in established, as distinct from the value of real
transition, observing evidence of trends which estate only, ready to operate but without a going
may affect the property in the future. business.
Conformity Investment Interest
Change Going Concern Value
Competition Financial Value
Contribution Business Value
Correct answer
73. Holds that profit tends to breed competition Going Concern Value
and excess profit tends to breed ruinous
competition. 80. Broadly buildings or other more or less
Contribution permanent structures or developments located
Conformity upon or attached to land.
Competition Real Property
Change Improvements
Real Estate
74. Holds that the maximum value is realized Land
when a reasonable degree of homogeneity is Correct answer
present. Improvements
Conformity
Competition
81. The rate of return on investment irrespective 89. The cost of constructing a similar property
of, and independent of, any capital recovery which is equally desirable and has the same
received or demanded by the investor or the rate utility as the one under appraisal.
on borrowed money. Reproduction Cost New
Recapture Rate Quantity Survey
Rate of Return Replacement Cost New
Capitalization Rate Unit in Place Cost
Interest Rate
90. The cost of constructing an exact replica of
82. Assets which are not readily convertible to the building being appraised using current prices
cash. of labor and materials and contractor's practices.
Intangible Assets Quantity Survey
Tangible Assets Unit in Place Cost
Fixed Assets Replacement Cost New
Capital Property Reproduction Cost New

83. A valuation technique which presumes that

income can be split between land and 91. Based on the Philippine Valuation
improvements and that the residual to land can Standards, there are only two (2) values namely
be then capitalized into value. Market Value and Non-Market Value.
Cost Approach
Building Residual Technique Which of the folloing are not non-market values?
Land Residual Technique Liquidation Value, Prompt Sale Value
Income Approach Insured Value, Special Value
Owner's Value, Plottage Value
84. These are conditions and assumptions Scrap Value, Salvage Value
under which appraisal is made.
Valuer's Certification 92. A revenue-raising procedure, based on the
Waiver assessed value of property related to a scale of
Limiting Condition charges defined by stattue within a specified
Foreword timeframe.
Real Property Taxation
85. The environment or location in which goods Ad Valorem Taxation
and services trade between buyers and sellers Income Tax
through a price mechanism. Duty
Arm's Length
Demand 93. In PVS, individual properties, such as hotels,
Economy fuel stations, and restaurants that usually
Market change hands in the marketplace while
remaining operational are referred to as:
86. Also known as Comparative Approach and Income Generating Properties
Direct Comparison Approach, an appraisal Public-Sector Assets
procedure in which the market value estimate is Specialized Properties
predicated upon prices paid in actual market Trade Related Properties
transactions and current listings.
Income Approach 94. A financial modeling technique based on
Residual Approach explicit assumptions regarding the prospective
Market Data Approach income and expenses of a property or business
Cost Approach which involves the projection of a series of
periodic cash flows either to an operating
87. The process of valuing a group of properties property, a development property, or a business.
as of a given date using standard methodology, Net Present Value
employing common data, and Discounting Cash Flow Analysis
Model Calibration Direct Capitalization
Tax Mapping Yield Capitalization
Real Property Taxation
Mass Appraisal 95. Which of the following statements applies to
a property with a non-conforming use?
88. A process of analyzing sets of property and A non-conforming use is likely to arise from
market data to determine the specific changes in zoning
parameters of a valuation model. In the sales comparison approach, an appraised
Mass Appraisal does not have to make a separate adjustment
Tax Mapping for the non-conforming use
Real Property Taxation A non-conforming use property may be under-
Calibration improved but cannot be over-improved
The existing non-conforming use is the highest
and best use
96. Which of the following statements is not
correct?
Valuation Standards are statements of
recognized principles and concepts
Valuation Standards describe the different
valuation methodologies
Valuation Standards are statements of best
practices of valuation and reporting
Valuation Standards are statements of accepted
definition

97. It is a commercial, industrial, service, or

investment entity pursuing an economic activity.
Investment
Business
Commercial Property
Financial Interest

98. Interest resulting from the legal division of

ownership interests in businesses and real
property from the contractual grant of an
optional right to buy or sell property.
Investment
Financial Interest
Goodwill
Business

99. When a property's highest and best use is

likely to change in the near future, the prevailing
highest and best use is called a (an):
Interim Use
Temporary Use
Alternative Use
Pending Use

100. The estimated additional cash inflow at the

end of the economic life of the subject property
under appraisal is known as:
Time Value of Money
Present Value
Discounting Cash Flow
Reversion Value/Exit Value
 Its major concern are :
1. It is the application of economic techniques to
real estate markets which describe, explain, and - Management of households
predict patterns of prices, supply, and demand.
A. Real Estate Economics - The enterprise or firm as economic unit
B. Economics
C. Housing Economics A. Real Estate Economics
D. Macroeconomics B. Economics
E. Microeconomics C. Housing Economics
F. Real Estate Market D. Macroeconomics
E. Microeconomics
2. It is narrower in scope, concentrating on F. Real Estate Market
residential real estate markets as does the
research of real estate trends focus on the 7. The following are CHARACTERISTICS of
business and structural changes impacting the REAL ESTATE except:
industry. A. Unique
A. Real Estate Economics B. Immovable
B. Economics C. Investment
C. Housing Economics D. Supply and Demand
D. Macroeconomics E. Space
E. Microeconomics F. Appreciation
F. Real Estate Market
Feedback
3. It is a social science that studies and seeks Characteristics of Real Estate
the efficient allocation of scarce resources to
satisfy unlimited human needs and wants. 1. Unique - no two lots have the same value to
A. Real Estate Economics the user even if they are adjacent lots
B. Economics
C. Housing Economics 2. Immovable - it has fixed location
D. Macroeconomics
E. Microeconomics 3. Investment - it is a hedge against inflation
F. Real Estate Market
4. Space - it is about the ownership, usage, and
4. An abstract sphere within which price control of space
influencing factors tend to operate and wherein
payment of consideration is accompanied by 5. Appreciation - land generally appreciate in
transfer of rights rather than by the movement of value
property.
A. Real Estate Economics 8. These people are both owners as well as
B. Economics tenants. They purchase houses or commercial
C. Housing Economics property as an investment and also to live in or
D. Macroeconomics utilize as a business.
E. Microeconomics A. Facilitators
F. Real Estate Market B. Renovators
C. Developers
5. Studies a nation or the world’s economy as a D. Renter
whole, using data about inflation, unemployment E. Owner
and industrial production to understand the past F. Owner/User
and predict the future.
9. This includes banks, Real Estate Brokers,
Its major concern are the following: lawyers, and others that facilitate the purchase
and sale of real estate.
• The rate of economic growth A. Facilitators
B. Renovators
• The inflation rate C. Developers
D. Renter
• Rate of unemployment E. Owner
A. Real Estate Economics F. Owner/User
B. Economics
C. Housing Economics 10. These people supply refurbished buildings
D. Macroeconomics to the market.
E. Microeconomics A. Facilitators
F. Real Estate Market B. Renovators
C. Developers
6. Studies the behavior of specific sectors of the D. Renter
economy, such as companies, industries, or E. Owner
households. F. Owner/User
11. These people are pure investors. They do C. Non-homogeneity
not consume the real estate that they purchase. D. Area Preference
Typically they rent out or lease the property to E. Permanence
someone else. F. Improvements
A. Facilitators G. Scarcity
B. Renovators
C. Developers 17. ECONOMIC CHARACTERISTICS OF
D. Renter REAL ESTATE:
E. Owner
F. Owner/User It is a characteristic of land because the supply
of usable land in a given area is finite/limited;
12. These people are pure consumers. there’s only so much of it.
A. Facilitators A. Immobility
B. Renovators B. Indestructibility
C. Developers C. Non-homogeneity
D. Renter D. Area Preference
E. Owner E. Permanence
F. Improvements
F. Owner/User G. Scarcity

13. These people prepare raw land for building 18. ECONOMIC CHARACTERISTICS OF
which results in new product for the market. REAL ESTATE:
A. Facilitators
B. Renovators A parcel of land can be improved in ways that
C. Developers will have a substantial impact on its use and
D. Renter value, and certain types of improvements will
E. Owner also affect the use and value of neighbouring
F. Owner/User land.

14. PHYSICAL CHARACTERISTICS OF REAL It is also called “Modification".

ESTATE: A. Immobility
B. Indestructibility
The geographical location of the property C. Non-homogeneity
remains the same. D. Area Preference
A. Immobility E. Permanence
B. Indestructibility F. Improvements
C. Non-homogeneity G. Scarcity
D. Area Preference
E. Permanence 19. ECONOMIC CHARACTERISTICS OF
F. Improvements REAL ESTATE:
G. Scarcity
This economic characteristic, sometimes called
15. PHYSICAL CHARACTERISTICS OF REAL “SITUS”, does not refer to geographical location
ESTATE: rather to people’s choice and preference for a
given area.
No parcels of real estate are exactly alike. Even
if two parcels of real estate look exactly alike, It is unique quality of people’s (Socio-economic)
they always will be different because of their preference that results in different valuation
unique locations. being attributed to similar units.
A. Immobility
B. Indestructibility “It is the most important economic
C. Non-homogeneity characteristics of land. “
D. Area Preference A. Immobility
E. Permanence B. Indestructibility
F. Improvements C. Non-homogeneity
G. Scarcity D. Area Preference
E. Permanence
16. PHYSICAL CHARACTERISTICS OF REAL F. Improvements
ESTATE: G. Scarcity
Land cannot be destroyed or worn out. Its 20. ECONOMIC CHARACTERISTICS OF
appearance may be altered but it continue to REAL ESTATE:
exist. Also, improvements to land, such
buildings, usually have a long life. Also called fixity. It means that investments in
real estate are long term.
It is also referred to as DURABILITY. This is primarily due to the physical
A. Immobility characteristics of immobility and indestructibility.
B. Indestructibility
Because land is immobile, investment in It is the probable price or amount that a willing
property becomes fixed. seller and a willing buyer would agree in an
A. Immobility open market.
B. Indestructibility A. Price
C. Non-homogeneity B. Value/Market Value
D. Area Preference C. Cost
E. Permanence D. Supply
F. Improvements
G. Scarcity 25. DETERMINANTS OF VALUE

21. Real estate is said to be a “spark plug” For something to have value, it must be desired.
which triggers off activities in allied industries, Real estate has value because it is a rare
creates income opportunities for different private commodity that satisfies human desires.
sectors, and enhances the market. A. Demand
A. Multiplier Effect B. Utility
B. Universal C. Scarcity
C. Shelter D. Transferrability
D. Inflation E. Purchasing Power
E. Collateral
F. Appreciation 26. The ability to participate, economically
speaking, in an activity. The methods of
Feedback calculating what products people can afford vary
ECONOMIC SIGNIFICANCE OF REAL from product to product and industry to industry.
ESTATE A. Demand
B. Utility
• Multiplier Effect – real estate is said to be a C. Scarcity
“spark plug” which triggers off activities in allied D. Transferrability
industries, creates income opportunities for E. Purchasing Power
different private sectors, and enhances the
market; 27. DETERMINANTS OF VALUE
• Universal – there is a universal need for real
estate; The ability to transfer title/ ownership or use of
• Shelter– one of the basic needs of man is the property to someone else.
shelter; A. Demand
• Inflation – investment in real estate is a hedge B. Utility
against inflation; C. Scarcity
• Collateral– real estate is the most preferred D. Transferrability
collateral and is therefore the major source of E. Purchasing Power
capital formation;
• Appreciation – land generally appreciates in 28. DETERMINANTS OF VALUE
value;
Relates to a product or service’s ability to satisfy
22. It is the combination of the factors of a want, need, or desire.
production to produce an improvement or A. Demand
development. It is the amount of money used to B. Utility
construct improvements plus the value of the C. Scarcity
land. It may or may not equal value be D. Transferrability
depending on whether costs are warranted or E. Purchasing Power
wisely made.
A. Price 29. DETERMINANTS OF VALUE
B. Value/Market Value
C. Cost For an item to have value, it must not be readily
D. Supply available. some degree of rareness &
uniqueness.
23. It is the amount of money or its equivalent A. Demand
given in exchange for real estate property or any B. Utility
interest therein. It is the amount for which the C. Scarcity
property is actually sold. D. Transferrability
A. Price E. Purchasing Power
B. Value/Market Value
C. Cost 30. In real estate economics, the main
D. Supply determinants of the demand for housing is:
A. Supply
24. It is the utility or attribute of a property to B. Demographics
satisfy human want or to command other C. Demand
properties in exchange. D. Cost
31. If the supply of existing housing deteriorates 40. One which lacks the proper formalities, form
due to wear, then the stock of housing supply: or words or other requisites prescribed by law
A. Appreciates for a mortgage, but shows the intention of the
B. Remains constant parties to make the property subject of the
C. Become stagnant contract as security for a debt and contains
D. Depreciates nothing impossible or contrary to law.
Correct answer A. Closed Mortgage
D. Depreciates B. Conventional Mortgage
C. Blanket Mortgage
32. One of the following is not an economic D. Equitable Mortgage
characteristic of real estate:
A. Area Preference 41. What fractional interest is involved in the
B. Scarcity sale of either limited ownership, rights to use
C. Transferability and occupy a residential or hotel rooms?
D. Fixity A. Joint Tenancy
B. Leasehold
33. The most important economic characteristic C. Timeshare
of real estate is: D. Co-ownership
A. Situs Feedback
B. Scarcity A timeshare is a property with a divided form of
C. Fixity ownership or use rights. These properties are
D. Modifications typically resort condominium units, in which
multiple parties hold rights to use the property,
34. Which of the following is not a physical and each owner of the same accommodation is
characteristic of real estate? allotted their period of time.
A. Immobility
B. Utility 42. All of the following clauses in a loan
C. Indestructibility agreement enable the lender to demand the
D. Uniqueness entire remaining balance be paid immediately
EXCEPT:
35. Refers to the process of making installment A. Due-on-Sale Clause
payments consisting of principal and interest B. Alienation Clause
that reduces the loan balance. C. Defeasance Clause
A. Amortization D. Acceleration Clause
B. Interest
C. Downpayment 43. An existing mortgage loan can have its lien
D. Term Payment priority lowered through the use of a:
A. Reconveyance Of Mortgage
36. It is the compensation paid for the use of the B. Subordination Agreement
capital. C. Satisfaction Of Mortgage
A. Interest D. Hypothecation Agreement
B. Income
C. Rent 44. The clause in a mortgage instrument that
D. Earnest Money would prevent the assumption of the mortgage
by a new purchaser is a:
37. Refers to the capacity to satisfy wants, A. Power Of Sale Clause
production by labor, and their exchangeability. B. Defeasance Clause
A. Economic Utility C. Due-on-sale Clause
B. Economic Life D. Certificate Of Sale Clause
C. Economic Value
D. Exchange Value 45. What project management tool is
appropriate to use to schedule, organize and
38. A real estate mortgage that covers several coordinate activities within a project?
properties is called: A.FLOW CHART
A. Closed Mortgage B.CPM
B. Conventional Mortgage C.PERT
C. Blanket Mortgage D.GANTT
D. Equitable Mortgage
Feedback
39. A type of mortgage loan that is not insured Program Evaluation Review Technique (PERT)
or guaranteed by the government. Instead, the is a project management planning tool used to
loan is backed by private lenders, and its calculate the amount of time it will take to
insurance is usually paid by the borrower. realistically finish a project. PERT charts are
A. Closed Mortgage used to plan tasks within a project — making it
B. Conventional Mortgage easier to schedule and coordinate team
C. Blanket Mortgage members.
D. Equitable Mortgage
46. A horizontal bar chart used in project c.Land, building, machineries and
management to visually represent a project plan improvements of the land
over time. It illustrates a project schedule. d.Land, building, and improvements of the land
A.FLOW CHART
B.CPM 54. An upfront fee charged by a lender to
C.PERT process a new loan application.
D.GANTT A. Loan origination fee
B. Prepayment penalty
47. An extension of credit from a seller to a C. Prepayment of mortgage insurance
buyer to allow the buyer to complete the D. Advance interest payment
transaction is called:
A. Purchase money mortgage 55. A measure comparing the amount of your
B. Package mortgage mortgage with the appraised value of the
C. Blanket mortgage property. It is the amount of a loan expressed
D. Growing equity mortgage as a percentage of the value of the real estate
offered as collateral.
48. The act of lending money at an interest rate A. Debt-to-equity ratio
that is considered unreasonably high or that is B. Amortization ratio
higher than the rate permitted by law. C. Loan-to-value ratio
A. Usury D. Capital-use ratio
B. Deficiency
C. Flopping 56. It is a financial ratio indicating the relative
D. Redlining proportion of shareholders' equity and debt used
to finance a company's assets. Closely related
49. An illegal discriminatory practice in which a to leveraging, the ratio is also known as risk,
mortgage lender denies loans or an insurance gearing or leverage.
provider restricts services to certain areas of a A. Debt-to-equity ratio
community, often because of the racial B. Amortization ratio
characteristics of the applicant’s neighbourhood. C. Loan-to-value ratio
A. Usury
B. Deficiency D. Capital-use ratio
C. Flopping
D. Redlining 57. The right a mortgagor has to regain the
property by paying the debt after a foreclosure
50. Where the buyer of a short sale purchases sale is called:
the property for less than the true fair market A. Recapture
value by influencing the appraiser or real estate B. Reversion
agent to provide a Broker Price Opinion (BPO) C. Redemption
which undervalues the property. D. Acceleration
A. Usury
B. Deficiency 58. The clause in a trust deed or mortgage that
permits the lender to declare the entire unpaid
C. Flopping balance immediately due and payable upon
D. Redlining default is the
A. Acceleration clause
51. If a property sold at a mortgage foreclosure B. Escalation clause
does not bring an amount suffficient to satisfy C. Judgement clause
the outstanding mortgage debt, the mortgagor D. Forfeiture clause
may be responsible for:
A. Default judgement 59. The type of real estate loan that allows the
B. Liquidated damages lender to increase the outstanding balance of a
C. Punitive damages loan up the original sum in the note while
D. Deficiency judgement advancing additional funds is the:
A. Graduated-payment mortgage
52. The defeasance clause in a mortgage B. Wraparound mortgage
requires the mortgagee to execute: C. Open-end mortgage
A. Assignment of mortgage D. Growing-equity mortgage
B. Satisfaction of mortgage
C. Subordination agreement 60. A unique financing option that allows a
D. Partial release agreement mortgage owner to get a second mortgage to
support the payment of the original real estate
53. Under RA#7160, real property is an asset mortgage plan.
which includes: A. Graduated-payment mortgage
a.Land, building, machineries, trees and B. Wraparound mortgage
improvements C. Open-end mortgage
b.Land, building, trees and improvements of the D. Growing-equity mortgage
land
61. A type of fixed-rate mortgage with an
amortization schedule that provides lower B. Recapture Rate
payments early on that then increase over time. C. Interest Rate
A. Graduated-payment mortgage D. Discount Rate
B. Wraparound mortgage
C. Open-end mortgage 69. A type of loan wherein the Lender has some
D. Growing-equity mortgage complete control over the project and the
income from a certain period, part or all of which
62. A type of fixed-rate mortgage where is assigned to him to amortize the project.
monthly payments increase over time according A. Turn-key Loan
to a set schedule, rather than remaining fixed B. Multi-Window Lending Program
and equal over the loan term. The interest rate C. Project Loan
on the loan does not change, and there is never D. Construction Loan
any negative amortization.
A. Graduated-payment mortgage 70. A branch of finance which deals with
investing money or wealth in real estate is
B. Wraparound mortgage called:
C. Open-end mortgage A. Real Estate Finance
D. Growing-equity mortgage B. Real Estate Investment
C. Real Estate Investment Trust
63. The pledging of property as security for D. Real Estate Development Corp.
payment of a loan without surrendering
possession is: 71. A condition prevailing in a particular place as
A. Subordination of a certain period of time when demand is great
B. Hypothecation but very few properties are for sale, thereby
C. Equity tending to increase the price.
D. Disintermediation A. Buyer's Market
B. Seller's Market
64. When depositors withdraw savings deposits C. Perfect Market
from an intermediary financial institution, such D. Imperfect Market
as a savings and loan association or commercial
bank, in favor of direct investment. 72. A condition prevailing in a particular place as
A. Subordination of a certain period of time when there are many
B. Hypothecation buyers and sellers; price is at its lowest.
C. Equity A. Buyer's Market
D. Disintermediation B. Seller's Market
C. Perfect Market
65. The difference between the market value of D. Imperfect Market
your home and the amount you owe the lender
who holds the mortgage. 73. A condition prevailing in a particular place as
A. Subordination of a certain period of time when demand is low
B. Hypothecation while many properties are for sale, thereby
C. Equity tending to suppress price.
D. Disintermediation A. Buyer's Market
B. Seller's Market
66. The process of ranking home loans C. Perfect Market
(mortgage, HELOC or home equity loan) by D. Imperfect Market
order of importance.
A. Subordination 74. An environment in which all parties do not
B. Hypothecation have complete information, and in which
C. Equity participants can influence prices.
D. Disintermediation A. Buyer's Market
B. Seller's Market
67. A real estate loan payable in periodic C. Perfect Market
installments that are sufficient to pay the D. Imperfect Market
principal in full during the term of the loan is
called a: 75. The desirability of the economic utility of the
A. Straight loan property is known as:
B. Partially amortized loan A. Economic Utility
C. Conventional loan B. Economic Life
D. Fully amortized loan C. Economic Value
Correct answer D. Economic Obsolescence
D. Fully amortized loan
76. An undertaking by two or more parties for
68. The rate of return earned by an investor, the purpose of implementing a particular
which does not include allowance for capital business and sharing costs and earnings in
recovery is: proportion to that share is known as:
A. Cash Flow A. Joint Venture
B. Partnership 85. Interest rate is the rate of return earned by
C. Business Development an investor, which does not include allowance
D. Syndication for:
A. Capital Recovery
77. When a group of investors pools together B. Cash Flow
their capital to jointly purchase a large real C. Recapture
estate property. D. Discount
A. Joint Venture
B. Partnership 86. These refer to the changes that result when
C. Business Development wealthier people acquire or rent property in low
D. Syndication income and working class communities.
A. Progression
78. The composite interest rate that represents B. Gentrification
the anticipated income of the investments made C. Competition
and the return which represents recovery of the D. Regression
investments.
A. Capitalization Rate 87. The Gross Income Multiplier is a factor
B. Recapture Rate derived from comparable properties and applied
C. Nominal Rate to expected rental income to estimate:
D. Over-all Rate of Return A. A known price
B. A gross income
79. A commercial property producing an annual C. A established cost
gross income of Php 390,000 was sold two D. A value
months ago for Php 3,412,500. What is the
property's gross income multiplier? 88. Many seller and buyers, price at its lowest.
A. 8.75
B. 7.0 A. Perfect Market
C. 7.75 B. Imperfect Market
D. 8.5 C. Monopoly
D. Monopsony
80. It is a factor derived from the comparable E. Oligopoly
properties and applied to expected rental F. Oligopsony
income to estimate a value.
A. Gross Income Multiplier 89. Single seller, multiple buyers.
B. Gross Income Tax A. Perfect Market
C. Appraised Value B. Imperfect Market
D. Gross Income C. Monopoly
D. Monopsony
81. Refers to buying an under priced property E. Oligopoly
and then quickly reselling it at market value. F. Oligopsony
A. Flipping
B. Bird Dogging 90. Few sellers, more buyers; few buyers, more
C. Deal Swinging sellers; price goes up and down accordingly.
D. Brokering A. Perfect Market
Correct answer B. Imperfect Market
A. Flipping C. Monopoly
D. Monopsony
82. Getting paid a referral fee for finding good E. Oligopoly
deals for investors is known as: F. Oligopsony
A. Flipping
B. Bird Dogging 91. Single Buyer, multiple seller.
C. Deal Swinging A. Perfect Market
D. Brokering B. Imperfect Market
C. Monopoly
83. Economic Utility refers to the capacity to D. Monopsony
satisfy wants, production by labor and their: E. Oligopoly
A. Exchangeability F. Oligopsony
B. Uniqueness
C. Transferability 92. Few seller, multiple buyers
D. Scarcity A. Perfect Market
B. Imperfect Market
84. A Blanket Mortgage is a real estate C. Monopoly
mortgage that covers: D. Monopsony
A. A single property E. Oligopoly
B. All Properties F. Oligopsony
C. Several Properties
D. Not more than two (2) properties 93. Few buyers, multiple sellers.
A. Perfect Market
B. Imperfect Market 101. It is during this life cycle where a
C. Monopoly neighborhood or zone regains momentum or
D. Monopsony sees rebirth and occurs because of an area's
E. Oligopoly proximity to employment or other conveniences
F. Oligopsony within fringe areas around older downtown
business districts.
94. A personal property mortgage is a: A. Growth
A. Real Estate Mortgage B. Stability
B. Blanket Mortgage C. Decline
C. Chattel Mortgage D. Revitalization

D. Collateral Pledge 102. It is the study of a specific market, the

collection and dissection of data and the
95. A group of homogenous land uses. conversion of that data to information that can
A. Zone/District be used for analysis and decision-making by an
B. City appraiser or analyst.
C. Neighborhood A. Market Segmentation
D. Municipality B. Market Analysis
C. Market Study
96. A group of complementary uses. D. Marketability Study
A. Zone/District E. Feasibility Study
B. City
C. Neighborhood 103. The act of distinguishing or delineating
D. Municipality markets that the appraiser should consider in his
data program.
97. Neighborhoods and zones alike generally A. Market Segmentation
exist in one of four life cycle stages. These are: B. Market Analysis
A. Growth, Stability, Decline, Revitalization C. Market Study
B. Stability, Decline, Revitalization, Expansion D. Marketability Study
C. Expansion, Decline, Revitalization, Growth E. Feasibility Study
D. Revitalization, Expansion, Growth, Stability
104. It is the analysis of an environment of
buyers, sellers, landlords, tenants, lessors, and
98. It is typically the initial stage in a
lessee which is not site specific and usually
neighborhood or zone's life cycle.
relates to a certain property type or geograhic
A. Growth
area.
B. Stability
A. Market Segmentation
C. Decline
B. Market Analysis
D. Revitalization
C. Market Study
Correct answer
D. Marketability Study
A. Growth
E. Feasibility Study
99. This occurs when a neighborhood can no
105. This study relates to a more specific
longer compete with other comparable
product type within a defined market, often
neighborhoods and usually enters this stage of
addresses the time required to absorb a
the life cycle where improvements become
particular product, and the price or rent level at
functionally not adequate and lose market
which that product would be accepted into the
appearl, and maintenance levels frequently
marketplace and is usually both site specific and
decrease similar to those like Escolta, and Rizal
property type specific.
Avenue in Manila.
A. Market Segmentation
A. Growth
B. Market Analysis
B. Stability
C. Market Study
C. Decline
D. Marketability Study
D. Revitalization
E. Feasibility Study
Correct answer
C. Decline 106. A process of compiling factual data and
information for the purpose of determining the
100. This refers to the period in which the
likelihood that a project development will fulfill
neighborhood or zone is expanding and
the objectives of the investment.
developing; typically matures and grows at a
A. Market Segmentation
slower rate and occure when it is no longer
B. Market Analysis
profitable to build, and or the supply of vacant
C. Market Study
land is depleted, like in Quiapo and Binondo.
D. Marketability Study
A. Growth
E. Feasibility Study
B. Stability
C. Decline 107. The three (3) types of market analysis that
D. Revitalization are performed by appraisers either separately or
as part of a complete appraisal are:
A. Market Study, Feasibility Study, and
Marketability Study
B. Marketability Study, Market Study, and
Market Segmentation
C. Feasibility Study, Market Study, and Cost
Feasibility
D. Market Segmentation, Feasibility Study and
Market Study

108. A method investors may use to determine

market value. This method calculates the market
value of a property by using the gross rents an
investor anticipates the property will produce at
end of year 1 multiplied by a given factor.
A. Gross Rent Multiplier
B. Gross Operating Income
C. Gross Income Multiplier
D. Income Capitalization Approach

Feedback
The gross rent multiplier is calculated using the
gross rent for a property. On the other hand, the
gross income multiplier is calculated using gross
potential income, which considers all sources of
income for a property, not just the rental income.

109. It is the total income generated by the

operations of a property before payment of
operating expenses, which is calculated from
potential rental income, plus other income
affected by vacancy, less vacancy and credit
losses, plus other income not offered by
vacancy.
A. Gross Rent Multiplier
B. Gross Operating Income
C. Gross Income Multiplier
D. Income Capitalization Approach
Correct answer
B. Gross Operating Income

110. Generally, any future economic benefit

arising from a business, an interest in a
business or from the use of a group assets
which has not been separately recognized in 46. A fund in which periodic deposits of equal
another asset. amounts are accumulated to pay a debt or
A. Intangible Assets replace assets is called:
B. Goodwill A sinking fund
C. Synergistic Value Starting Income
D. Terminal Value Deferred Annuity
An amortized Loan
Also known as Future Cash, it represents the
anticipated return of a capital sum at the end of 47. A real estate loan that has an initial period
the investment. of low or no monthly payments, at the end of
Rent which the borrower is required to pay off the full
Leased Fee balance in a lump sum. The monthly payments,
Subordinate Sublease if any, may be interest only, and the interest rate
Lease offered is often relatively low.
Reversion Blanket Mortgage
Leasehold Conventional Mortgage
Assignment Balloon Mortgage
Sublease Assumption of Mortgage

Analyzing the capacity of a particular property to 48. In the absence of an agreement to the
contain economic activities, services, and other contrary, the mortgage normally having priority
comforts to supply client's needs is called will be the one:
____________ analysis. That is a construction loan mortgage
Economic That was recorded first
Property Productivity For the greatest amount
Social That is a permanent mortgage
Market
49. The seller would have the least financing
42. An economic concept refers to the price exposure in:
most likely to be concluded between the buyers Purchase "subject to" mortgage
and sellers of a good/property or services that is Assumption of loan by buyer
available for purchase. New financing by buyer
Price Purchase money mortgage
Profit
Value 50. A type of secured loan where funds are
Market released by providing a piece of real estate as a
collateral to the lender.
43. What refers to the actual or estimated period Real Estate Finance
of net income produced by the revenues and Pre-approved Loan
expenditures in the operation of an income Mortgage
producing property? HDMF Loan
Capitalization
Cost Approach 51. The original size of the loan, which may or
Market Analysis may not include certain other costs.
Cash Flow
Goes down in size as the loan is repaid.
44. What is the term used that refers to the Interest
withdrawal of funds from intermediary financial Amortization
institutions, such as bank and savings and loan Principal
association to invest them directly? Loan-to-Value Ratio
Bail out
Disintermediation 52. A financial charge for use of the lender's
Funds Flow money.
Cash Flow Profit
Amortization
45. Select the most probable value which a Principal
property should bring in a competitive and open Interest
market under all conditions requisite to be a fair
sale, the buyer and seller each acting prudently, 53. Helps banks and other lenders assess how
knowledgeably, and assuming the price is not much risk they are taking in providing a loan to a
affected by undue stimulus. borrower. It is the ratio of the loan amount
Substitution divided by the value of the property.
Economic Negative Leverage
Market Loan to Value Ratio (LTV)
Special Gross Rent Multiplier
Positive Leverage
Debt to Income Ratio (DTI)
Leverage
Gross Income Multiplier
It is a metric used in commercial real estate
54. Percentage of gross monthly income that analysis to compare the income-producing
goes to paying your monthly debt payments. characteristics of properties.
Gross Rent Multiplier Gross Income Multiplier
Leverage Debt to Income Ratio (DTI)
Debt to Income Ratio (DTI)
Positive Leverage Positive Leverage
Negative Leverage Gross Rent Multiplier
Loan to Value Ratio (LTV) Leverage
Gross Income Multiplier Loan to Value Ratio (LTV)
Negative Leverage
55. An investment strategy of using borrowed
money, specifically, the use of various financial 60. A legal process that allows lenders to
instruments or borrowed capital, to increase the recover the amount owed on a defaulted loan by
potential return of an investment. taking ownership of and selling the mortgaged
property.
It is the amount of debt used to finance assets or Garnishment
investing activities. Writ of Execution
Positive Leverage Foreclosure
Loan to Value Ratio (LTV) Attachment
Gross Income Multiplier
Negative Leverage 61. It is a preliminary legal procedure to seize
Gross Rent Multiplier property in anticipation of a favorable ruling for a
Leverage plaintiff who claims to be owed money.
Debt to Income Ratio (DTI) Attachment
Foreclosure
56. Occurs when you borrow money at a lower Garnishment
interest rate than the return you get on the Writ of Execution
amount of cash that would otherwise be
invested. 62. An order directing a third party to seize
Loan to Value Ratio (LTV) assets, usually wages from employment or
Negative Leverage money in a bank account, to settle an unpaid
Positive Leverage debt.
Leverage Writ of Execution
Debt to Income Ratio (DTI) Foreclosure
Gross Rent Multiplier Attachment
Gross Income Multiplier Garnishment

57. When a loss is incurred whereby the return 63. An indicator of price inflation and it
would be less than the interest rate. represents changes in a basket of goods.
Gross Income Multiplier
Negative Leverage It is used to estimate the average variation
Debt to Income Ratio (DTI) between two given periods in the prices of
Leverage products consumed by households.
Positive Leverage Purchasing Power
Gross Rent Multiplier Consumer Price Index
Loan to Value Ratio (LTV) Macroeconomics
Real Estate Economics
58. A screening metric used by investors to
compare rental property opportunities in a given 64. The broadest measure of a country’s
market. economy, and it represents the total market
value of all goods and services produced in a
It is the ratio of the price of a real estate country for a given period.
investment to its annual rental income before Gross Domestic Product
accounting for expenses such as property taxes, Microeconomics
insurance, and utilities. Macroeconomics
Leverage Gross National Product
Gross Income Multiplier
Debt to Income Ratio (DTI) Represents the value of all goods and services
Negative Leverage for all Filipino-owned enterprises and activities
Loan to Value Ratio (LTV) within and outside of the country’s national
Gross Rent Multiplier borders.
Positive Leverage Gross Domestic Product
Gross National Product
59. It is the ratio between the sale price or value Macroeconomics
of a property and its gross income from rent and Microeconomics
other income sources.
66. A measure of the extent to which available 74. When the Banko Sentral ng Pilipinas sells
labour resources are being used. more treasury notes and bonds to mop up
Balance of Payments excess liquidity in the system, the government in
Unemployment Rate effect is using:
Consumer Confidence Index (Retail Sales) Fiscal Policy
Employment Rate Power of the Purse
Political policy
67. Measures the share of workers in the labor Monetary Policy
force who do not currently have a job but are
actively looking for work. 75. A key aspect of a political system in which a
Balance of Payments central governmental authority dictates the
Unemployment Rate levels of production that are permissible and the
Consumer Confidence Index (Retail Sales) prices that may be charged for goods and
Employment Rate services.

68. The ratio between the amount of payments It is also known as Planned Economy.
received from abroad and the amount of Command Economy
payments going abroad. Traditional Economy
GNP Mixed Economy
Consumer Confidence Index (Retail Sales) Market Economy
GDP
Balance of Payments 76. An economic system in which economic
decisions and the pricing of goods and services
69. The report is particularly useful because it is are guided by the interactions of a country's
a timely indicator of broad consumer spending individual citizens and businesses.
patterns that is adjusted for seasonal variables. Traditional Economy
Mixed Economy
It provides an indication of future developments Command Economy
of households' consumption and saving. Market Economy
Marketability Analysis
Consumer Price Index 77. A basic economic system where customs
Consumer Confidence Index (Retail Sales) and traditions are the elements that determine
Balance of Payments the way trade and commerce are performed. It is
a self-sufficient economy where the community
70. Generally the process by which the central engages in different activities to produce goods
bank, or government controls the supply and or services that are required by the rest of the
availability of money, the cost of money, and the community.
rate of interest. Mixed Economy
Command Economy
This is used by the government to be able to Market Economy
control inflation, and stabilize currency. Traditional Economy
Fiscal Policy
Monetary Policy 78. A system that combines aspects of both
capitalism and socialism.
71. Measures employed by governments to
stabilize the economy, specifically by It protects private property and allows a level of
manipulating the levels and allocations of taxes economic freedom in the use of capital, but also
and government expenditures. allows for governments to interfere in economic
Fiscal Policy activities in order to achieve social aims.
Monetary Policy Command Economy
Market Economy
72. In the country where there is only one telco Traditional Economy
provider, that specific company enjoy its: Mixed Economy
Monopsonic Market
Oligopolistic Market
Monopolistic Market 79. A foundational assumption of many
Oligopsonic Market economic theories that claims human beings are
Correct answer generally self-interested and will take advantage
Monopolistic Market of others when possible.
Capitalism
73. The ________ is the amount of interest Communism
charged on your loan every year. Socialism
Interest Per Annum Traditionalism
Annual Percentage Rate Opportunism
Loan increment
Principal Interest 80. A political and economic system in which
property and the means of production are owned
in common, typically controlled by the state or 87. Where any change in price is matched by an
government. equal change in quantity (where the number is
equal to 1).
It is based on the idea that common or public Unit Elastic
ownership of resources and means of Relatively Inelastic
production leads to a more equal society. Perfectly Inelastic
Traditionalism Relatively Elastic
Capitalism Perfectly Elastic
Communism
Opportunism 88. Where small changes in price cause large
Socialism changes in quantity demanded (the result of the
formula is greater than 1).
81. One where class distinctions are eliminated Perfectly Elastic
and the community as a whole owns the means Perfectly Inelastic
to production. Relatively Elastic
* Relatively Inelastic
Capitalism Unit Elastic
Socialism
Traditionalism 89. Where any very small change in price
Opportunism results in a very large change in the quantity
Communism demanded.
Relatively Elastic
82. The economic system where the factors of Perfectly Inelastic
production such as capital goods, labour, natural Perfectly Elastic
resources, and entrepreneurship are controlled Relatively Inelastic
and regulated by private businesses. Unit Elastic
Socialism Correct answer
Communism Perfectly Elastic
Opportunism
Capitalism 90. The minimum amount that a lender agrees
Traditionalism to advance in order for a builder to commence
construction on a project.
83. A system that relies on customs, history, Hard Money Loan
and time-honored believes. CRE Loan
Traditionalism Floor Loan
Communism Acquisition, Development, and Construction
Socialism Loan
Opportunism
Capitalism 91. A contract of sale with the stipulation that
the vendor shall have the right to buy back the
84. The ratio of the percentage change in property within the agreed period.
quantity demanded of a product to the Pacto De Retro Sale
percentage change in price. Pactum De Non Aliendo
Pactum Commissorium
Economists employ it to understand how supply Dacion En Pago
and demand change when a product’s price Tacita Reconducta
changes.
Hypothecation 92. It means that if at the end of the period of
Demand Index lease, the lessee continues to enjoy the thing
Price Elasticity of Demand leased with the acquiescence of the lessor, it is
Supply and Demand undertood that there is an implied lease.
Pactum Commissorium
85. Where the quantity demanded does not Pacto De Retro Sale
change when the price changes. Dacion En Pago
Relatively Elastic Tacita Reconducta
Unit Elastic Pactum De Non Aliendo
Relatively Inelastic Correct answer
Perfectly Elastic Tacita Reconducta
Perfectly Inelastic
93. A stipulation which prohibits the mortgagor
86. Where large changes in price cause small from alienating the property within the period of
changes in demand (the number is less than 1). the mortgage.
Perfectly Elastic
Relatively Elastic In the Philippines, this is considered as void and
Unit Elastic of no legal effect.
Relatively Inelastic Pactum De Non Aliendo
Perfectly Inelastic Tacita Reconducta
Dacion En Pago
Pactum Commissorium from the entry of judgment, and that in default of
Pacto De Retro Sale such payment the property shall be sold at
public auction to satisfy the judgment.
94. A stipulation which authorizes the mortgagee Equity of Redemption
to appropriate the property as his own upon Right of Redemption
failure of the debtor to fulfill the principal Redemption
obligation. Conventional Redemption
Legal Redemption
In the Philippines, this is considered as void and
of no legal effect. 100. The mortgagor may redeem the property
Pacto De Retro Sale within the term of one (1) year from the date of
Pactum De Non Aliendo registration of auction sale.
Pactum Commissorium Redemption
Tacita Reconducta Legal Redemption
Dacion En Pago Conventional Redemption
Equity of Redemption
95. Payment of the debt or obligation with a Right of Redemption
property. It means "Payment in Kind."
Pacto De Retro Sale 101. The process by which a mortgagee
Pactum Commissorium acquires an absolute title to the property of
Tacita Reconducta which he had previously been only the
Pactum De Non Aliendo conditional owner or upon which he had
Dacion En Pago previously a mere lien or encumbrance.
A. Equitable Mortgage
96. A transaction through which the mortgagor, B. Foreclosure
or one claiming in his right, by means of a C. Judical Confirmation
payment or the performance of a condition, re- D. Adjudication
acquires or buys back the value of one title
which may have passed under the mortgage. 102. A contract of sale whereby part of the
Legal Redemption purchase price is paid upon the execution of the
Equity of Redemption contract with the balance to be paid within a
Right of Redemption stipulated period and the property is mortgaged
Redemption by the VENDEE to the VENDOR to secure the
Conventional Redemption payment of the said balance.
DEED OF SALE WITH ASSUMPTION OF
97. The right to be subrogated upon the same MORTGAGE
terms and conditions stipulated in the contract, DEED OF SALE WITH MORTGAGE
in the place of one who acquires a thing by
purchase or by payment in kind or by any other
transaction whereby ownership is transmitted by 103. A contract of sale whereby the property
onerous title. being sold is presently mortgaged and the
Redemption VENDEE pays a certain amount to the VENDOR
Equity of Redemption and assumes as well the existing obligation
Conventional Redemption which is secured by a mortgage over the
Legal Redemption property.
Right of Redemption DEED OF SALE WITH ASSUMPTION OF
MORTGAGE
98. Takes place when a vendor reserves the DEED OF SALE WITH MORTGAGE
right to repurchase the thing sold with the
obligation of returning to the vendee the price of
the sale, the expenses of the contract and any
other legitimate payments made by reason of
the sale, the necessary and useful expenses
made on the thing sold, and of complying with
other stipulations which may have been agreed
upon.
Redemption
Legal Redemption
Right of Redemption
Conventional Redemption
Equity of Redemption
Correct answer
Conventional Redemption

99. The right to redeem the mortgaged property

by paying the amount ordered by the court
within a period of not less than ninety (90) days
nor more than one hundred twenty (120) days
It is a basic principle of value which affirms that Php 112,500
value is the present worth of all present and Php 168,750
future benefits arising from ownership and use Php 140,625
of real estate.
Anticipation Feedback
Conformity Step 1: Calculate the total area of the lot in
Progression square meters.
Regression Area = Length × Width
Area = 25 meters × 30 meters = 750 square
3. The increment of value created when two meters
sites are combined to produce greater utility.
Plottage Step 2: Determine the Assessed Value of the
Accretion property.
Synergistic Value Assessed Value = Area × Unit Value
Assemblage Assessed Value = 750 square meters ×
Php15,000 per square meter = Php11,250,000
4. Arises from the combination of two or more
assets to create a new asset that has a higher Step 3: Calculate the Basic Real Property Tax
value than the sum of the individual assets. (RPT).
Assemblage Basic RPT = Assessed Value × Maximum
Accretion Assessment Level × Basic Tax Rate
Synergistic Value For a commercial property in a city, the
Plottage Maximum Assessment Level is 50% (0.50) and
the Maximum Basic Tax Rate for City is 2%
5. The process of combining two or more sites (0.02).
into one ownership or use
Assemblage Basic RPT = Php11,250,000 × 0.50 × 0.02 =
Synergistic Value Php112,500
Plottage
Accretion Step 4: Calculate the Special Education Fund
(SEF) Tax.
6. The increase of the actual land on a stream,
SEF Tax = Assessed Value × SEF Tax Rate
lake or sea by the action of water which deposits
For a city, the Maximum SEF Tax Rate is 1%
soil upon the shoreline. It is Mother Nature's little
(0.01).
gift to a landowner.
Synergistic Value
SEF Tax = Php11,250,000 × 0.50 x 0.01 =
Accretion
Php56,250
Plottage
Assemblage
Step 5: Calculate the Total Real Property Tax
7. It is also known as the concept of the agents (Basic + SEF).
of production. It states that land has the last Total RPT = Basic RPT + SEF Tax
claim to the net income after the cost of other Total RPT = Php112,500 + Php56,250 =
factors of production has been paid. Php168,750
Regression
92. An apartment complex has a 400 units, 50
Progression
of which are available for lease. How many units
Surplus Productivity
should be rented out in order for that the
Highest and Best Use
vacancy rate be reduced to 5%?
360
Property-specific data, or data more directly
370
relevant to the property being valued and to
350
comparable properties are also gathered and
380
examined. These include the following except:
Site and Improvement Dat Feedback
Cost Step 1: Calculate 5% of the total number of units
Depreciation Data in the apartment complex.
Income and Expense Data Vacant units at 5% = 5% of 400 units = 0.05 *
Assessed Value 400 = 20 units
A commercial rectangular lot with a Step 2: Find the number of units that need to be
measurement 25 meters by 30 meters and has a rented out to achieve the desired vacancy rate.
unit value of Php15,000 per square meter based Desired number of rented units = Total units -
on the schedule of market value of the assessor. Vacant units at 5%
Compute the total real property tax (Basic and Desired number of rented units = 400 - 20 = 380
SEF) to be paid using the maximum assessment units
level for a commercial land and maximum basic
and SEF tax rate of a city. 93. Which factor is used in the appraisal of
Php 45,000 machinery using the RCN that refers to the
normalize average of price relatives for a given 96. What are the three (3) major division of an
class of goods or services in a given region, Appraisal Report?
during given interval of time? Introduction; Description Analysis and
Coefficient Conclusion
Price Index Introduction; Conclusion and Addenda
Foreign Exchange Rate Description Analysis and Conclusion and
Variable Addenda
Introduction; Description Analysis and
Feedback Conclusion and Addenda
The Price Index is used in the appraisal of
machinery using the RCN (Replacement Cost Feedback
New) method. The Price Index refers to the The three major divisions of an Appraisal Report
normalized average of price relatives for a given are:
class of goods or services in a given region
during a given interval of time. It helps in Introduction: This section provides an overview
adjusting the RCN to reflect changes in the cost of the appraisal report, including the purpose of
of machinery over time due to inflation or market the appraisal, the property being appraised, the
fluctuations. date of the appraisal, and any other relevant
introductory information.
Coefficient: While coefficients are used in
various mathematical equations and statistical Description Analysis and Conclusion: This
models, they are not directly related to the section contains a detailed description and
specific description given in the question about analysis of the property being appraised. It
machinery appraisal using the RCN method. includes information about the property's
physical characteristics, location, condition, and
Variable: A variable is a factor that can vary or any other relevant factors that may impact its
change in a given context. Although the Price value. The appraiser presents their analysis and
Index is a variable in the sense that it changes arrives at a conclusion regarding the property's
over time, it is not the term used to describe the estimated value based on the data and
specific factor mentioned in the question. methodologies used.

Foreign Exchange Rate: The foreign exchange Addenda: The addenda section includes any
rate refers to the rate at which one currency can additional supporting documentation, data, or
be exchanged for another. It is not directly information that may be relevant to the appraisal
related to the appraisal of machinery using the but not necessarily included in the main body of
RCN method, which focuses on local price the report. This can include maps, photographs,
variations and does not involve foreign market data, or other supplemental materials.
exchange considerations.
97. What statistical measurement measures the
94. In percent, what is the assessment level on dispersion of a dataset relative to its mean and
Machineries at commercial and agricultural is calculated as the square root of the variance?
classification? Predictive
80 and 50 Regression
80 and 60 Descriptive
80 and 40 Standard deviation
80 and 30
Feedback
Feedback Standard deviation provides a way to quantify
RA 7160: On Machineries Class Assessment the spread or dispersion of data points in a
Levels (ARCI) dataset. It tells us how much individual data
Agricultural 40% points deviate from the mean. A smaller
Residential 50% standard deviation indicates that the data points
Commercial 80% are close to the mean, while a larger standard
Industrial 80% deviation indicates that the data points are more
spread out from the mean.
95. Define Donor’s Tax.
Tax on the privilege of transmitting one’s The formula for calculating the standard
property or property rights to others without deviation is as follows:
adequate and full consideration
Tax on transmitting one’s property or property Standard Deviation (σ) = √Variance
rights to others without adequate and full
consideration Where Variance is the average of the squared
Tax on transmitting one’s property to others differences between each data point and the
without adequate and full consideration mean.
Tax on the privilege of transmitting one’s
property to others without adequate and full 98. Since lakes do not allow access to
consideration seaborne trade, which of the following provinces
are still considered to be “landlocked”?Untitled
Question
Batangas and Cavite
Cavite and Rizal
Rizal and Laguna
Calamba and Laguna

99. At what instance is the cost approach most

applicable in appraising the property?
If the property is apparently costliest in the
vicinity
If the property has many old features that make
the appraisal report interesting to real
If the property has no improvement
If the property has new improvements that
represent the highest and best use of the
land
The fact that housing trends to pass to lower A one car garage
groups is known as_________. A house that lacks modern equipment
Diminishing Return A garbage dumpsite in the neighborhood
Filtering Down Correct answer
The multiplier effect A garbage dumpsite in the neighborhood
Economies of Scale
10. If a real estate development happens to go
2. Cost advantages that can occur when a bankrupt, who would be the first to get back
company increases their scale of production and money from liquidation?
becomes more efficient, resulting in a decreased Consultants to the project
cost-per-unit. Developers
This is because the cost of production (including Equity financiers
fixed and variable costs) is spread over more Debt Financiers
units of production.
Filtering Down 11. Which of the following examples best
The multiplier effect reflects investment value?
Economies of Scale Value to a typical buyer or seller
Diminishing Return Value to a specific buyers or seller
Value for insurance purposes
3. Family size and age group distribution is an Value for property tax purposes
example of social forces that affect
_____________. 12. Risk resulting from uncertainty in rents,
Environment protection vacancies or operating expenses is referred to
Individual responsibility as _____________.
Real estate value Business risk
Natural resources Interest risk
Economic risk
4. Which of the following macro economic Operating risk
trends affect real estate value?
Natural resources 13. A study of the supply and demand
Location conditions in specific area for a specific type of
Real estate demand property is called ________________.
Climate condition Supply and demand
Economic base
5. One of the political forces that affect real Market analysis
estate value is____________. Projection analysis
Environmental Protection Laws
Employment opportunities and trends 14. An estimate of the rate at which a particular
Family size and age group distribution type of space will be sold each year is referred
Zoning and land use regulation to as____________.
Absorption
6. Which of the following are economic forces Pre-sales
that affect real estate value? Occupancy
Employment opportunities and trends Rental rate
Environmental Protection Laws
Family size and age group distribution 15. In real estate market, which of the following
Zoning and land use regulation states a condition obtained in an area at certain
time where supply is more than the demand and
7. Which of the following is an example of social price tends to go down?
forces that affect real estate value? Over improvement
Buyer’s market
Infiltration
Employment opportunities and trends Seller’s market
Level of Wages Correct answer
Natural resources Buyer’s market
Attitudes about development, growth and
ecology 16. Which is the major factor used in evaluating
real estate demand?
8. What happens to the value when the Population growth and density
capitalization rate increases? Environmental protection
The value is constant Lifestyle and living standards
The value remain stable Trade and industry
The value decreases
The value increases 17. Which of the following political and legal
factors would most negatively affect real estate
9. Which of the following is an example of demand?
economic obsolescence? Construction permit
A house that needs maintenance Population growth
Building Regulation Consultancy in real estate
Rent Control Property viewing
Gathering listings
18. In land use analysis, which of these factors Paying taxes
would most affect demand in real estate?
Political and legal factors 27. If a property’s net income ratio id 0.75, what
Location is its operating expense ratio?
Psychological needs 0.25
Social Forces 25
0.025
19. Utilizing real estate economic tools such as 2.5
regression analysis can best predict one of the
following. Which is it? 28. An office building was recently sold for
Supply and demand in housing P60,000,000. Given the following information:
Production of goods and services
General business activities Gross Potential Income: P12,000,000
Level of wages Vacancy Factor: 10%
Correct answer Expenses: 45% of Effective Gross Income
Supply and demand in housing Annual Mortgage Payment: P4,500,000
Equity: P12,500,000
20. Which of the following explains the
accelerated increase of real estate Determine the cash-on-cash rate/equity dividend
developments? rate.
Low Interest Rates 12%
Level of wages 7.50%
Zoning Regulations 11.52%
Environmental protection 7.48%
Feedback
21. What happens to real estate demand when Cash-on-Cash Rate of Return (Equity Dividend
interest rate is below inflation rate? Rate) = Net Cash Flow before Tax / Equity
The real estate cycle becomes stagnant.
The demand of real estate increases. 1st. PGI less vacancy and collection losses
The economy experience depression. 12,000,000 x 90% = 10,800,000 (EGI)
The demand of real estate decreases.
2nd: EGI less Operating Expenses
22. When you are analyzing macro-economic 10,800,000 x 55% = 5,940,000 (NOI)
information for real estate, which of these
elements will you best consider? 3rd: NOI less Debt Service
OFW remittances 5,940,000 - 4,500,000 = 1,440,000 (Net Cash
Imports and Exports Flow before Tax)
Stock market trends
Inflation Rate 4th: Net Cash Flow before Tax divided by Equity
1,440,000 / 12,500,000 = 0.1152 x 100 =
23. One of the data used in measuring the
11.52% (Cash-on-Cash Return/Equity Dividend
supply of real estate inventory is ____________.
Rate)
Voter’s list
Construction Permit 29. Bernardo Builders will receive P100,000 in 7
Postal address years. If the appropriate interest rate is 10%, the
Demographics present value of the P100,000 receipt is:
P194,000
24. One of the four essential elements of real
P151,000
estate economic is ___________.
P51,000
Natural resources
P51,316
Utilization
Feedback
Topography
Present Value of 1 Formula
Land

25. In packaging a real estate project, the real PV = FV (1+r)-n

estate practitioner is required to have basic
knowledge of __________. 1/ (1.10)^7= 0.5131581182
Market Analysis 0.5131581182 x 100,000
Appraisal = 51,316
Real Estate Economics
30. How much should an investor pay today to
Accounting
be assured of earning of 6% with an investment
26. Real estate economics is applied when real of Php 500,000 per year for 6 years considering
estate practitioner undertakes one of the a factor of 4.917324?
following. Which is it? P2,458,662
P1,694,688
P1,016,813 Expenses: 45% of effective gross income
P2,016,312 Annual mortgage payment: P4,125,000
Feedback Equity: P12,500,000
500,000 x 4.917324 = 2,458,662
What is the equity dividend rate or cash
31. At the end of two years, what will be the on cash rate of return?
balance in a savings account paying 6% 10.12%
annually if P5,000 is deposited today? 5%
P5,000 7.48%
P5,600 9%
P5,618
P5,300 Feedback
Correct answer Cash-on-Cash Rate of Return (Equity Dividend
P5,618 Rate) = Net Cash Flow before Tax / Equity
Feedback
PV Factor = (1+r)N 1st. PGI less vacancy and collection losses
10,000,000 x 92% = 9,200,000 (EGI)
(1+0.06)^2 = 1.1236
5,000 * 1.1236 = 5,618 2nd: EGI less Operating Expenses
9,200,000 x 55% = 5,060,000 (NOI)
or
3rd: NOI less Debt Service
5,000 x 1.06^2 = 5,618 5,060,000 - 4,125,000 = 935,000 (Net Cash
Flow before Tax)
32. What is the value of the property that has a
monthly net income of Php75,000.00 and with 4th: Net Cash Flow before Tax divided by Equity
an overall capitalization rate of 9%? 935,000 / 12,500,000 = 0.0748 x 100 = 7.48%
P10,000,000.00 (Cash-on-Cash Return/Equity Dividend Rate)
P900,000.00
P1,000,000.00 35. Converting an estimate of income into an
P833,333.00 estimate of value by use of rate
Feedback Income Estimate
IRV Formula Discount Rate
Income/Rate = Value Capitalization
Value Estimate
75,000 x 12 = 900,000 (Annual Income)
900,000 / 9% = 10,000,000 (Value) 36. It is the technique used to convert an
estimate of single year’s income into an
33. An appraisal is to be made for a three indication of value by dividing the estimated
bedroom house. One comparable with two income and multiplying the income estimate.
bedrooms is sold for Php5,000,000.00. The Direct capitalization
appraiser makes an adjustment of Land residual technique
Php500,000.00 to the comparable to account for Yield capitalization
the difference in the number of bedrooms. Component rate method

The adjusted sales price of the comparable is: 37. A yield rate used to convert future payments
P4,550,000.00 or receipts to present value.
P4,500,000.00 Split Rate
P5,500,000.00 Capitalization Rate
P5,550,000.00 Overall Rate
Discount Rate
Feedback
5,000,000 Value of a comparable with two 38. To arrive at net operating income, expenses
bedrooms are deducted from:
500,000 Appraisers adjustment for the three Gross Potential Income (PGI)
bedrooms Operating Profit
5,500,000 Net Operating Income (NOI)
Effective Gross Income (EGI)
*If comparable is SUPERIOR, DEDUCT Correct answer
adjustment to its value Effective Gross Income (EGI)
*If comparable is INFERIOR, ADD adjustment to
its value 39. The lessee pays the lessor a fixed
percentage of the total amount transacted in the
34. An office building recently sold for leased property is called a:
P50,000,000. Given the following information: Step-Up Lease
Inflation-Indexed Lease
Gross potential income: P10,000,000 Percentage Lease
Vacancy factor: 8% Flat Lease
 Net capitalization
40. The estimated additional cash flow at the
end of the economic life of the subject property
under appraisal is known as: 49. In the building residual technique, the
Market Value appraiser starts with the assumption of:
Present Value Net Capitalization
Discounting Replacement cost
Reversion Value Land Value
Building Value
41. Suppose a lease contract called for rent of
P100 per sq.m . However, similar space in the 50. Schedule rent that is higher than market rent
market rented at P150 per sq.m . The amount creates:
specified in the lease is known as the Overage Rent
_________ rent. Excess Rent
Overage Gross Rent
Contract Escalation Rent
Market
Economic 51. Other name for contract rent is:
Market Rent
42. A positive leasehold interest maybe created Economic Rent
only if the contract rent is: Schedule Rent
Greater than the market rent Surplus Rent
Equal to market rent
Less than the market rent 52. All factors being equal, as the location of an
NOTA income property become less desirable, the cap
rate used will be:
43. Effective gross income (EGI) is the Unaffected
anticipated income from operation of a project Lower
after adjustment for: Higher
Operating expense Less Reliable
Realty tax and insurance
Vacancy and credit loss 53. Why is the gross income multiplier normally
All of the above not subject to adjustments by the appraiser?
Relative desirability is presume to be
44. Which of the following terms refers to the reflected in the gross income multiplier
right of a person who owns a property but has generated in the market place
leased it to someone else? It is impossible to make adjustment when using
Lessee’s estate income data
Leasehold estate Any differences between properties would be
Fee simple estate significant
Leased fee estate The income approach never allows for
adjustment of any kind
45. The rate in percent which is the sum of the
interest rate and recapture rate for building 54. An appraiser calculates the present value of
Capitalization Rate income based on the contract rent and adds the
Interest Rate present value of the reversion at the end of the
Overall Rate lease.
Split Rate
What legal interest is being calculated?
46. The interest belonging to the tenants created Life estate
by the leasing of the property: Fee Simple Estate
Economic Rent Leasehold Estate
Leased Fee Estate Leased Fee Estate
Contract Rent
Leasehold Estate
55. The determination of the capitalization rate
47. Which of the approaches to value would by the process of dividing the net income by the
involve an investigation into the rent schedules selling price is:
of the subject property and the comparables The Summation Method
Cost Approach The Comparative Method
Income Approach The Yield Method
Market Approach The Band of Investment Method

48. In the land residual technique, the appraiser 56. The leased fee estate pertain to the property
starts with the assumption of: interest of the:
Land value Owner of the land in Fee Simple
Replacement cost Lessee
Building value Owner of the Leasehold Estate
Lessor Feedback
Overall Cap Rate = NOI/SP
57. The net income before recapture is 0.75/9 = 8.33%
estimated by deducting the following from the
effective gross income: 64. If a property’s net income ratio is 0.85, what
All building expenses excluding maintenance is its operating expense ratio?
and repair cost 0.015
All expense excluding depreciation 0.58
All expenses in the operation of the property 1.5
including depreciation 0.15
All real estate taxes only
65. Given the following information:
58. Rent saving is the difference between: Building capitalization rate: 0.11
Flat contract rent and step up contract rent Land capitalization rate: 0.09
Sublease rent and lessee’s rent Land value as a percent of total value: 35%
Market rent and economic rent
Market rent and contract rent What is the over all capitalization rate by using
the band of investment approach?
59. The basic formula for property valuation via 0.097
the income capitalization approach is: 0.110
V = IR 0.100
V = R/I 0.103
V = I/R Feedback
V = SP/GR Band of Investment Method

60. The simplest and most reliable method of 35% x 0.09 = 0.0315
the income capitalization is: 65% x 0.11 = 0.0715
The equity residual technique 0.0315 + 0.0715 = 0.103
The building residual technique
The land residual technique 66. An office building recently sold for
The direct capitalization technique P50,000,000. Given the following information:

61. The total anticipated revenue from income Gross potential income: P10,000,000
property operations after vacancy and collection Vacancy factor: 8%
losses are deducted is: Expenses: 45% of effective gross income
Property residual technique Annual mortgage payment: P4,125,000
Net operating income Equity: P12,500,000
Effective gross income
Potential gross income What is the over all rate of return for the
property?
62. A commercial property producing an annual 10%
gross income of P390,000 was sold two months 7.48%
ago for P3,412,500. What is the property’s gross 10.12%
income multiplier? 8.3%
7.75
8.75 Feedback
7 1st. PGI less vacancy and collection losses
8.5 10,000,000 x 92% = 9,200,000 (EGI)
Feedback 2nd: EGI less Operating Expenses
GIM = Sale price / Gross income 9,200,000 x 55% = 5,060,000 (NOI)
GIM = 3,412,500 / 390,000 = 8.75 3rd: NOI divided SP
5,060,000 / 50,000,000 = 10.12%
Therefore, the property's gross income multiplier
is 8.75. 67. What would be recapture rate of a building
having a remaining economic life of 15 years?
This means that the property was sold for 8.75
times its annual gross income. 7%
15%
63. If a property has a net income ratio of 0.75 150%
and a gross income multiplier of 9, what is the 6.67%
indicated over all capitalization rate?
6.75% Feedback
8.33% 100 (Years) divided by 15 Years = 6.66666 or
2.78% 6.67%
12%
68. The value of a building with a net operating Income Attributable to Building = 1,400,000 x
income of P200,000 and with an over all 10%
capitalization rate of 9.5% is: = 140,000
P2,000,000
P2,200,000 Income Attributable to Land = 200,000 - 140,000
P2,300,840 = 60,000
P2,100,000
Land Value = 60,000/9.5%
Feedback = 631,578.95
Value = NOI / Cap rate
Value = 200,000 / 0.095 Property Value = 1,400,000 + 631,578.95
Value = P2,105,263.15 = Php 2,031,579 (rounded off)

Nearest answer is 2.1M. 72. A vacant lot is rented for a car display for
P24,000 per month. The interest rate applicable
69. Which of the following estimates would result to this type of property is 8%.
in a capitalization rate of 4%:
Net operating income of P200,000, value of Compute the value of the property by income
P5,000,000 approach.
Potential gross income of P200,000, value P2,400,000
P5,000,000 P2,800,000
Effective gross income of P200,000, value of P2,600,000
P5,000,000 P3,600,000

Feedback Feedback
A capitalization rate (cap rate) is a measure of Value = Income / Rate Value = 24,000/ 8%
the potential return on investment for a real Value = 3,600,000
estate property. It is calculated by dividing the
net operating income (NOI) of a property by its 73. A 30 year mortgage covering 75% of
market value. property value can be obtained from a bank for
8.5%. The mortgage constant is 0.092. Equity
In this case, the cap rate is 4%, which means for this type of property requires 12% return.
that the NOI of the property is 4% of its market
value. So, if the NOI is P200,000, then the What is the capitalization rate using the band of
market value of the property is P5,000,000. investments method?
10.50%
70. A building has a rental income of P350 per 9%
month. Using the monthly gross rent multiplier of 10.00%
125, the value of the building would be 9.90%
estimated at:
P35,714 Feedback
P437,500 CapRate by Band of Investment
P357,142
P43,750 R = (LTV x MC) + (ETV x ED)
R = (Loan to Value x Mortgage Constant) +
Feedback (Equity to Value x Equity Dividend)
GRM = SP/Income
SP = GRM x Income R (.75x .092) + (.25 x .12)
= 125 x 350 R = 9.90%
= P43,750
74. In a property residual capitalization
71. With the building value of P1,400,000, land approach, what is the value of an improved
capitalization rate of 9.5%, building capitalization property with a net income of P80,000 a year, an
rate of 10% and net operating income of interest rate of 8% and a recapture rate of 2%?
P200,000. P840,000
P1,000,000
The total property value, using the land residual P850,000
method would be: P800,000
P2,100,000
P2,022,500 Feedback
P2,031,579 Value = Income / Rate Value = 80,000/ (8%
P2,000,500 +2%)
Value = 800,000
Feedback
NOI = 200,000 75. Assume the following:
Building Value = 1,400,000
Building Cap Rate = 10% Annual net income from the property = P100,000
Land value = P200,000
Interest rate = 8%
Recapture rate = 4% 80. Which of the following property features
is/are important in the analysis of gross rent
What is the property value by the building multiplier comparables
residual technique? Income expense ratio
P900,000 Services included in the rent
P960,000 Location
P980,000 All of the above
P800,000
81. Economic rent can be defined as:
Feedback The potential gross rent
Land Value (LV) = 200,000 The contract rent
Interest Rate (I) = 8% The average rent
Recapture Rate (R) = 4% NOTA
Annual Net Income = 100,000
82. Which of the following is an example of a
Income due to Land (IL) = LV x I = 200,000 x 8% specific expense item rather than a basic
=16,000 expense category?
Income due to Building (IB) = NOI - IL = 100,000 Property taxes
- 16,000 = 84,000 Operating expenses
Fixed charges or expenses
Building Value (BV) = IB/(I+R) = 84,000 / 12% = Reserve for replacement
700,000
83. The property under appraisal has a 100%
occupancy. What conclusion would you most
Total (LV + BV) = 900,000
likely draw if the typical occupancy rate in the
76. If a particular buyer requires a recapture of area is only 95%?
the building portion of the price in 30 years, what Advertising is superior
is the indicated recapture rate of the building? Management is better
3 1/4% The rents are too high
3 1/3% The rents are too low
3 1/2 %
84. A rent survey reveals that buildings offering
3%
one bedroom units have a considerably lower
vacancy factor than those with two bedroom
Feedback
units. If the subject property includes only units
Recapture Rate = 1 /REL
with two bedrooms, the appraisal should
Recapture Rate = 1/30
probably project:
Recapture Rate = 3.333%
An average of the vacancy factors for all units
77. Which of the following might be classified as surveyed
tangible rather than intangible amenities? A higher factor than found in the one
Work satisfaction bedroom units
Free rent The same factor as found in the one bedroom
A sense of security units
Pride of ownership A lower factor than found in the one bedroom
No correct answers units

78. Anna of Las Piñas has a savings account 85. An apartment owner spent P125,000 last
that just paid a P35,000 annual dividend. If the year to replace five built in stoves. In a 10 unit
declared interest was 7%, which of the following apartment house, what annual expense would
represents the amount of the deposit? be projected for replacement if all the units had
P 500,000 stoves?
P 50,000
P 850,000 Assume a 10 year life for all replacements.
P 37,634 P50,000
P500,000
Feedback P125,000
Value = I/R P25,000
Value = 35,000/7%
Value = 500,000 Feedback
Cost per stove = 125000/ 5
79. An income property renting for P500,000 per Cost per stove = 25,000
year before expenses just sold for P5,000,000 Annual Expense = 25,000 x 10 units ÷ 10 years
cash. What was the gross income multiplier? Annual Expense = 25,000 per unit per year
1/10 or 10%
5 86. If economic rent is less than contract rent,
10 the difference is known as:
15 Excess rent
Overage rent In which method is invested capital recovered
Percentage rent from the annual income in exactly the same
Capital gain manner as a loan is paid off?
The double declining balance method
87. In market value appraisals, which of the The annuity or Inwood Method
following items should be excluded rom the The accelerated method
expense statement? The straight line recapture
Necessary current expenses
Projected expenses 93. The simplest and most reliable method of
Loan interest payments income capitalization is:
Correct answer The direct capitalization technique
Loan interest payments The building residual technique
The equity residual technique
88. Painting and redecorating of units is an The land residual technique
expense that appraisers normally treat as:
A fixed expense 94. If a P5,000,000 property has qualified for a
An operating expense 75% loan and at a 16% loan constant and the
Overhead buyer wants a 6% annual cash return on his
Unnecessary if you have 100% occupancy down payment, what net income would the
property have to produce?
89. Income capitalization is the broad term used P800,000
to describe the process of estimating the value P300,000
of income property by studying the economic P607,000
relationship between income and value. P675,000

This process: Feedback

Ro = (LTV x MC) + (ETV x ED)
I. Reflects the time value of money by reducing Ro = (Loan to Value x Mortgage Constant) +
or discounting future income to its present worth (Equity to Value x Equity Dividend)

II. Converts the net income of a property into its Ro (.75x .16) + (.25 x .06)
equivalent capital value Ro = .135
Ro= NOI/Value
III. Focuses on the present worth of future .135 = NOI/5,000,000
benefits NOI = .135 x 5,000,000
I and II only NOI = 675,000
II and III only
I and III only 95. If a particular buyer requires a recapture of
I,II,III the building portion of the price in 10 years, what
I only is the indicated recapture rate for the building,
assuming straight line recapture?
90. The appraiser’s choice of a capitalization 10%
technique and rate should consider the 5%
investment criteria that motivate purchasers of 20%
investment property. 2%

Which of the following refers to the ability to use Feedback

the property as loan collateral? Recapture rate = 1 / Useful life
Loanability Recapture rate = 1 / 10 = 0.1 = 10%
Hypothecation
Safety 96. Recapture of the investment capital in real
Liquidity estate finance is that portion of the loan payment
that is earmarked for:
91. Capitalization rates may be estimated by any Interest on money due
of several methods. Payoff principal
Interest and principal payment
Which of the following is generally the preferred Loan to Value Ratio
method of deriving a capitalization rate?
Band of investment 97. A new building of 1,000 square meters has
Direct comparison just been constructed at a location where no
Residual Technique recent vacant land sales have occurred and
Summation competitive investments earn 10% interest. The
replacement cost is P20,000,000.
92. There are three recognized methods to
provide for capital recovery in income Assuming a life expectancy of 25 years, an
capitalization. economic rent of P500 per square meter per
month, and an annual expense of P1,500,000
including vacancy, what total property value is 1.21%
indicated? -1.20%
P45,000,000
P37,000,000 Feedback
P20,000,000 (1,235,000- 1,250,000)/1,250,000 = -1.20%
P57,000,000

Feedback
Gross Potential Income = Rent x 12 x 1,000
= 500 x 12 x 1,000 = 6,000,000

Less: Annual Expense: (1,500,000)

NOI = 4,500,000

Income Attributable to Building = V x i

where Value of the Building = 20,000,000
Building Rate = Interest + recapture
Recapture Rate = 1/25 = 0.04
Interest = 0.10
Building Rate = 0.14
Income Attributable to Building = 2,800,000

Deduct from NOI to arrive at Income Attributable

to Land
= 4.500,000 - 2,800,000 = 1,700,000

Land Value = I/r = 17,000,000

Property Value = Building Value + Land Value
= 20,000,000 + 17,000,000
= 37,000,000

98. Which of the following statements is correct?

Linear regression models always reflect trends
in sale prices correctly because they are tried
and tested analytical tools and leave no doubt
as to the validity of the conclusions.
Linear regression models always reflect trends
in sale prices correctly because they always
have valid data, although this data may be
misread.
Linear regression models always reflect trends
in sale prices correctly because the tool has no
known flaws.
Linear regression models may misstate
trends in sale prices if the data is flawed, if
there is not enough data, or the data is
misread by the user

99. What is the annual rate of increase indicated

by a sale of a property at P1,350,000 four years
ago and a resale today at P1,445,000?

Use the annual straight line method and round

your answer to the nearest percentage point.
9%
7%
2%
4%

Feedback
(1,445,000-1,350,000)/1,350,000/4 = .017593

100. If someone purchased a property for P

1,250,000 one year ago and sold it today for P
1,235,000, what is the percentage of change on
a straight line basis?
1.20%
-1.21%
 3. In a property residual capitalization approach,
1. How much should Mr. DJ pay today to be what is the value of an improved property with a
assured of earning of 6% with an investment of net income of P80,000.00 a year, an interest
Php 500,000 per year for 6 years considering a rate of 8% and a recapture of 2%?
factor of 4.917324?
Preferred Answer format: Php _,_,_
Preferred Answer format: Php _,_,_ Example: Php 56,000,123
Example: Php 56,000,123 **Round off your answer accordingly
**Round off your answer accordingly **Do not include your solutions, just type in your
**Do not include your solutions, just type in your answer in the space provided below.
answer in the space provided below.
Correct answers
Correct answers P800,000.00
Php 2,458,662
Feedback
Feedback The IRV Formula
The formula for the present value of an ordinary Income / Value = Rate %
annuity is: Income / Rate = Value $
Rate x Value = Income $
PV = Pmt * ((1 - (1 + r)^(-n)) / r)
Overall Rate = Interest Rate + Recapture Rate
where: Overall Rate = 8% + 2 %
PV = Present Value of the annuity Overall Rate = 10%
Pmt = Payment amount per period (Php 500,000
in this case, as it's invested each year) Value = Income / Rate
r = Interest rate per period (6% or 0.06 as a Value = 80,000 / 10%
decimal) Value = 800,000
n = Number of periods (6 years in this case)

Now, we also have a factor of 4.917324. This 📌Note: Interest Rate + Recapture Rate = Overall
factor is used to simplify the calculation of the Rate (OAR) or CapRate
present value. The factor is derived from the
above formula. 4. A machinery costing P500,000.00 had been
appraised at P1,000,000.00. The accumulated
PV = Pmt * factor depreciation on cost is P200,000.00 and an
appraised value of P500,000.00. The original life
Substitute the values: asset is 10 years.

PV = 500,000 * 4.917324 What is the age of the asset at the time of the
appraisal?
PV = 2,458,662
Preferred Answer format: __ Years
So, the present value (amount Mr. DJ should Example: 100 Years
pay today) is Php 2,458,662 to be assured of **Round off your answer accordingly
earning 6% on his investment of Php 500,000 **Do not include your solutions, just type in your
per year for 6 years, considering the factor of answer in the space provided below.
4.917324.
Correct answers
2. Zambales Realty will receive P100,000 in 7 4 years
years. If the appropriate interest rate is 10%, the
present value of the P100,000 receipt is: Feedback
Age of the Asset = Accumulated Depreciation /
Preferred Answer format: Php _,_,_ Original Cost x Original Life
Example: Php 56,000,123
**Round off your answer accordingly Age of the Asset = 200,000 / 500,000 x 10
**Do not include your solutions, just type in your Age of the Asset = 4 Years
answer in the space provided below.
5. A machinery costing P500,000.00 had been
Correct answers appraised at P1,000,000.00. The accumulated
P51,316 depreciation on cost is P200,000.00 and an
appraised value of P500,000.00. The original life
Feedback asset is 10 years.
Present Value of 1 Formula
PV = FV (1 + r)^-n What is the amount of annual appreciation that
PV = 1/(1.10)^7 = 0.5131581182 should be reported in the income statement of
PV = 0.5131581182 x 100,000 subsequently to the appraisal?
PV = 51,316
Preferred Answer format: Php _,_,_
Example: Php 56,000,123.01
**Round off your answer accordingly Now, we can calculate the area of the circle:
**Do not include your solutions, just type in your
answer in the space provided below. Area = π * (4 feet)^2
Area = π * 16 square feet
Correct answers
P125,000.00 Using the approximation of π as 3.14159:

6. The length of one side of an equilateral Area ≈ 3.14159 * 16 square feet

triangle is 6 meters. What is the area of the Area ≈ 50.265 square feet
triangle?
So, the correct area of the circle inscribed in the
Preferred Answer format: __ (unit of measure) square with a side length of 8 feet is
Example: 100 sqm approximately 50.265 square feet, which can be
**Round off your answer accordingly rounded to 50.27 ft^2.
**Do not include your solutions, just type in your
answer in the space provided below. 8. Compute the area of a circle circumscribed a
* square with a side length of 8 feet.

Correct answers Preferred Answer format: __ (unit of measure)

15.59m2 Example: 100 sqm
**Round off your answer accordingly
Feedback **Do not include your solutions, just type in your
Area = (sqrt(3) / 4) * side length^2 answer in the space provided below.

Where: Correct answers

Area is the area of the equilateral triangle, 100.53 ft^2
Side length is the length of one side of the
equilateral triangle. Feedback
When a circle is circumscribed around a square,
Given that the length of one side of the the diameter of the circle is equal to the diagonal
equilateral triangle is 6 meters, we can now of the square. The formula for the area of a
calculate the area: circle is:

Area = (sqrt(3) / 4) * 6^2 Area = π * (radius)^2

Area = (1.732 / 4) * 36
Area = 0.433 * 36 To find the radius of the circumscribed circle, we
Area = 15.588 or 15.59 square meters can use the Pythagorean theorem. In a square
with a side length of 8 feet, the diagonal (d) can
So, the area of the equilateral triangle is be calculated as follows:
approximately 15.59 square meters.
d = side length * √2
7. Compute the area of a circle inscribed in a d = 8 feet * √2 ≈ 11.314 feet
square with a side length of 8 feet.
Now, since the diameter of the circle is equal to
Preferred Answer format: __ (unit of measure) the diagonal, the radius (r) is half of the
Example: 100 sqm diagonal:
**Round off your answer accordingly
**Do not include your solutions, just type in your r=d/2
answer in the space provided below. r ≈ 11.314 feet / 2 ≈ 5.657 feet
Correct answers Now, we can calculate the area of the circle:
50.27 ft^2
Area = π * (5.657 feet)^2
Feedback Area ≈ π * 31.915 square feet
When a circle is inscribed in a square, the
diameter of the circle is equal to the side length Using the approximation of π as 3.14159:
of the square. The formula for the area of a
circle is: Area ≈ 3.14159 * 31.915 square feet
Area ≈ 100.530 square feet
Area = π * (radius)^2
So, the correct area of the circle circumscribed
Since the diameter of the inscribed circle is around the square with a side length of 8 feet is
equal to the side length of the square, the radius approximately 100.530 square feet, which can
of the circle is: be rounded to 100.53 ft^2.
Radius = Side length / 2
Radius = 8 feet / 2 = 4 feet
9. Compute the area of the square A = 15π square meters
circumscribed by a circle with a diameter of 4
meters. Using an approximate value for π, which is
3.14159:
Preferred Answer format: __ (unit of measure)
Example: 100 sqm A ≈ 15 * 3.14159 square meters
**Round off your answer accordingly A ≈ 47.12385 square meters
**Do not include your solutions, just type in your
answer in the space provided below. So, the area of the ellipse with a major axis of 10
meters and a minor axis of 6 meters is
Correct answers approximately 47.12 square meters.
8 square meters
11. Determine the amount of concrete needed to
Feedback fill a cylindrical hole with a radius of 1 meter and
To find the area of the square circumscribed by depth of 3 meters.
a circle with a diameter of 4 meters, we need to
first find the side length of the square, and then Preferred Answer format: __ (unit of measure)
use that to calculate the area of the square. Example: 100 sqm
**Round off your answer accordingly
When a circle is circumscribed around a square, **Do not include your solutions, just type in your
the diameter of the circle is equal to the diagonal answer in the space provided below.
of the square. If the diameter of the circle is 4
meters, then the diagonal of the square is also 4 Correct answers
meters. 9.42 cubic meters
9.42 m^3
Now, we can use the Pythagorean theorem to
find the side length (s) of the square: Feedback
To determine the amount of concrete needed to
s^2 + s^2 = 4^2 fill a cylindrical hole, you can calculate the
2s^2 = 16 volume of the cylinder. The formula for the
s^2 = 8 volume (V) of a cylinder is:
s = √8 ≈ 2.828 meters
V = π * r^2 * h
Now, we can calculate the area of the square:
where:
Area = side length^2 V = Volume of the cylinder
Area = (2.828 meters)^2 π ≈ 3.14159 (approximate value of pi)
Area ≈ 7.997584 square meters or 8 square r = Radius of the cylinder
meters h = Height (depth) of the cylinder

So, the area of the square circumscribed by a Given that the radius (r) is 1 meter and the depth
circle with a diameter of 4 meters is (h) is 3 meters, we can now calculate the
approximately 8 square meters. volume:

10. What is the area of an ellipse if the major V = π * (1 meter)^2 * 3 meters

axis is 10m and the minor axis is 6m? V = π * 1 square meter * 3 meters
V = 3π cubic meters
Preferred Answer format: __ (unit of measure)
Example: 100 sqm Using an approximate value for π, which is
**Round off your answer accordingly 3.14159:
**Do not include your solutions, just type in your
answer in the space provided below. V ≈ 3 * 3.14159 cubic meters
V ≈ 9.42477 cubic meters
Correct answers
47.12 m2 So, you would need approximately 9.42 cubic
meters of concrete to fill the cylindrical hole with
Feedback a radius of 1 meter and a depth of 3 meters.
The formula to calculate the area (A) of an
ellipse is: 12. The land plot is rectangular with dimensions
of 15 meters in frontage and 27.5 meters in
A = π * (major axis / 2) * (minor axis / 2) depth. A 5-meter setback is required at the front,
and there are 2.5-meter easements on the sides
Given that the major axis is 10 meters and the and rear portion. What is the maximum
minor axis is 6 meters, we can plug these values allowable building footprint on this land?
into the formula and calculate the area:
Preferred Answer format: __ (unit of measure)
A = π * (10 meters / 2) * (6 meters / 2) Example: 100 sqm
A = π * 5 meters * 3 meters **Round off your answer accordingly
**Do not include your solutions, just type in your **Round off your answer accordingly
answer in the space provided below. **Do not include your solutions, just type in your
answer in the space provided below.
Correct answers
200 m2 Correct answers
200 m^2 4500 ft2
200 square meters
Feedback
Feedback The formula to calculate the area of a right
To find the maximum allowable building footprint triangle is:
on the land plot, we need to account for the
setbacks and easements. The building footprint Area = (1/2) * base * height
will be the area of the rectangle that remains
after considering these restrictions. Given that the height is 150 feet and the base is
60 feet, we can calculate the area:
Front setback = 5 meters
Rear easement = 2.5 meters Area = (1/2) * 60 feet * 150 feet
Side easements (left and right sides) = 2 * 2.5 Area = 0.5 * 60 feet * 150 feet
meters = 5 meters (total for both sides) Area = 30 feet * 150 feet
Area = 4500 square feet
Now, we need to adjust the dimensions of the
rectangle to account for the setbacks and 15. Three identical cylindrical water tanks, each
easements: with a height of 3 meters and a circular base of
2-meter radius, are to be installed on a building.
Frontage after setback: 15 meters - 5 meters = The tanks will be placed on their sides and
10 meters separated by a 1-meter gap. What is the total
Depth after easements: 27.5 meters - 2.5 meters area that needs to be allotted for these water
(rear) - 5 meters (both sides) = 20 meters tanks atop the building?

Now, we have a rectangular area with Preferred Answer format: __ (unit of measure)
dimensions 10 meters (frontage) by 20 meters Example: 100 sqm
(depth). To find the maximum allowable building **Round off your answer accordingly
footprint, we calculate the area of this rectangle: **Do not include your solutions, just type in your
answer in the space provided below.
Area = 10 meters * 20 meters = 200 square
meters Correct answers
56sqm
Therefore, the maximum allowable building
footprint on this land is 200 square meters. Feedback
A = LW
13. What is the required area for the platform to A = 14 x 4
accommodate 3 tanks, each with a radius of 1 A = 56 sqm
meter, placed 1 meter apart, and with a 0.5-
meter clearance from all sides? 16. The flooring of a house covers an area of 30
square meters. How many tiles are required if
Preferred Answer format: __ (unit of measure) each tile measures 12 x 12 inches?
Example: 100 sqm
**Round off your answer accordingly Preferred Answer format: __ (unit of measure)
**Do not include your solutions, just type in your Example: 100 sqm
answer in the space provided below. **Round off your answer accordingly
**Do not include your solutions, just type in your
Correct answers answer in the space provided below.
27 m2
Correct answers
Feedback 323 Tiles
Radius of Tank = 1 meter
Distance between tank = 1 meter Feedback
Clearance on Sides = 0.5 To calculate the number of tiles required to
cover a flooring area of 30 square meters, we
Area = LW need to convert the measurements to the same
Area = 9m x 3m unit (inches or meters) to get a consistent result.
Area = 27m^2/ 27 square meters
Given that each tile measures 12 x 12 inches,
14. The area of a right triangle with a height of we can convert this measurement to square
150 feet and a base of 60 feet is: meters:

Preferred Answer format: __ (unit of measure) 1 inch = 0.0254 meters (approximately)

Example: 100 sqm
Tile dimensions in meters:
12 inches * 0.0254 meters per inch = 0.3048 Total cost of the building = Construction cost per
meters square meter * Usable area
Total cost of the building = P 30,000 per square
Now, we need to calculate the area of one tile in meter * 559 square meters
square meters: Total cost of the building = P 16,770,000

Area of one tile = 0.3048 meters * 0.3048 meters The total cost of the building is P 16,770,000.
= 0.09290304 square meters
18. Find the quantity of concrete required to fill
Next, to find the number of tiles required, we a cylindrical hole with a radius of 1 meter and a
divide the total area of the flooring by the area of depth of 3 meters.
one tile:
Preferred Answer format: __ (unit of measure)
Number of tiles = Total area of flooring / Area of Example: 100 sqm
one tile **Round off your answer accordingly
Number of tiles = 30 square meters / **Do not include your solutions, just type in your
0.09290304 square meters ≈ 322.92 answer in the space provided below.

Since you cannot have a fraction of a tile, you Correct answers

would need 323 tiles to cover the flooring area of 9.42477 cubic meters
30 square meters when using tiles that measure
12 x 12 inches each. Feedback
The formula to calculate the volume (V) of a
17. The construction cost of a commercial cylinder is:
building is P 30,000 per square meter. The
building is constructed on a rectangular lot with V = π * (radius)^2 * height
an area of 1,000 square meters and a frontage
of 20 meters. The building has a setback of 3.5 Given that the radius (r) is 1 meter and the
meters on all sides. Calculate the total cost of height (h) is 3 meters, we can plug these values
the building. into the formula:

Preferred Answer format: Php _,_,_ V = π * (1 meter)^2 * 3 meters

Example: Php 56,000,123.01 V = π * 1 square meter * 3 meters
**Round off your answer accordingly V = 3π cubic meters
**Do not include your solutions, just type in your
answer in the space provided below. Using an approximate value for π, which is
3.14159:
Correct answers
P 16,770,000 V ≈ 3 * 3.14159 cubic meters
V ≈ 9.42477 cubic meters
Feedback
Area of the lot = Frontage * Length So, the quantity of concrete required to fill the
1,000 square meters = 20 meters * Length cylindrical hole with a radius of 1 meter and a
Length = 1,000 square meters / 20 meters depth of 3 meters is approximately 9.42477
Length = 50 meters cubic meters.

Now, the usable area for the building is the area 19. The lot will be divided into five equal parts.
of the lot minus the setbacks on all sides. Each Among these parts, one part will be further
setback is 3.5 meters, so the dimensions of the subdivided into three equal parts. Calculate the
usable area will be: share of each of the three equal parts after the
subdivision.
Usable width = Frontage - (2 * setback) = 20
meters - (2 * 3.5 meters) = 20 meters - 7 meters **Do not include your solutions, just type in your
= 13 meters answer in the space provided below.
Usable length = Length - (2 * setback) = 50
meters - (2 * 3.5 meters) = 50 meters - 7 meters Correct answers
= 43 meters 1/15 of the entire lot

Now, we can calculate the usable area: Feedback

To calculate the share of the three equal parts
Usable area = Usable width * Usable length after subdividing one part of the lot into five
Usable area = 13 meters * 43 meters equal parts, follow these steps:
Usable area = 559 square meters
Start with the entire lot, which represents one
Finally, we can calculate the total cost of the part.
building: Subdivide the lot into five equal parts. Now, one
part of the lot is divided into five equal subparts.
Take one of the five subparts and further P 1,000,000
subdivide it into three equal parts. P 1,100,000
Now, let's calculate the share of the three equal P 880,000
parts:

Initially, the entire lot is considered as one part. Feedback

Let P = Price of the Property being appraised
After subdivision into five equal parts: 1st House (Sold Last Year) = 800,000
2nd House (Sold Yesterday) = 880,000
Each part = 1/5 of the entire lot. Comparable Property = 1,000,000
Now, take one part (1/5 of the lot) and subdivide
it into three equal parts: Ratio: 880,000/800,000 = 1.10 (Appreciation
Rate for a Year)
Each of the three equal parts = (1/5) * (1/3) = 6 months/12 months = 0.05 (5%) (Appreciation
1/15 of the entire lot. Rate for 6 months)
So, each of the three equal parts is 1/15 of the
entire lot. P = 1,000,000 * 1.05
P = 1,050,000
20. In a group, the proportion of Licensed Real
Estate Appraisers to Aspiring Real Estate 22. James, Hayme, and Babe made a sale.
Appraisers (REAs) is 10:3. Given that there are They received 5% commission from a sale of
70 Licensed Real Estate Appraisers, how many P3,400,000. James received 37% of the
Aspiring REAs are present in the group? commission. How much did James received?
69,200
Correct answer 26,900
21 62,900
62,800
Feedback
To find the number of Aspiring Real Estate Feedback
Appraisers (REAs) in the group, we can use the 3,400,000 x 0.05 = 170,000 (Entire Commission)
given ratio and the number of Licensed Real 170,000 x 0.37 = 62,900 (James' Share)
Estate Appraisers.
23. Randolph, Rudolf, and Roi received
The ratio of Licensed Real Estate Appraisers to P27,000. They decided to divide into 2:3:4
Aspiring REAs is 10:3. This means that for every proportions, respectively. How much did Roi
10 Licensed Real Estate Appraisers, there are 3 received?
Aspiring REAs. 6,000
9,000
Given that there are 70 Licensed Real Estate 12,000
Appraisers, we can set up a proportion to find 3,000
the number of Aspiring REAs:

(Aspiring REAs) / 70 = 3 / 10 Feedback

Let the shares be represented by x, y, and z,
Now, solve for the number of Aspiring REAs: respectively, for Randolph, Rudolf, and Roi.

Aspiring REAs = (3 / 10) * 70 According to the given information, the total

Aspiring REAs = 21 amount received is P27,000.

There are 21 Aspiring Real Estate Appraisers in So, the shares are:
the group. Randolph's share = 2x
Rudolf's share = 3x
21. As an Appraiser, you have identified a Roi's share = 4x
comparable property that is identical to the
subject property being appraised. The The sum of the shares is equal to the total
comparable property was sold six months ago amount received:
for P1,000,000. However, you need to make an
adjustment for the time difference between the 2x + 3x + 4x = 27,000
subject property and the comparable.
To make the time adjustment, you have found a Now, combine like terms:
paired sale of two houses. One of these houses
was sold one year ago for P800,000, and the 9x = 27,000
other house was sold yesterday for P880,000.
Now, solve for x:
Now, you need to calculate the proper estimated
adjusted sales price for your comparable x = 27,000 / 9
property based on the paired sale information. x = 3,000
P 1,050,000
Now, we can find Roi's share: 25. The scores of 5 students on a test are 75,
80, 85, 90, and 95. What is the mean of the
Roi's share = 4x scores?
Roi's share = 4 * 3,000 80
Roi's share = 12,000 85
90
Roi received P12,000. 95

24. In the appraisal of a single-family residence, Feedback

the appraiser identifies 6 comparable properties. The mean is the sum of the scores divided by
After verifying the data and making adjustments the number of scores. In this case, the mean is
to the comparables in relation to the subject (75 + 80 + 85 + 90 + 95) / 5 = 85.
property, the indicated values are provided with
specific weights as shown in the image below. 26. In a data set, the mode is 12, and the range
For comparables 1, 3, and 6, a weight of 10% is is 18. If the smallest value in the data set is 6,
assigned to each. For comparables 2 and 5, a what is the largest value?
weight of 20% is assigned to each. Lastly, 36
comparable 4 is given a weight of 30%. 24
30
Based on these weightings, what is the 42
estimated value of the subject property?
Feedback
The range is the difference between the largest
and smallest values, which is given as 18.

Let the largest value be x.

P 847,200
P 842,500
So, x - 6 = 18
P 842,700 x = 18 + 6
P 824,700 x = 24

27. A group of students took a math test, and

Feedback
the scores are: 85, 90, 78, 85, 80, 92, 75. What
Given weights:
is the range of the scores?
22
Comparables 1, 3, and 6 have a weight of 10%
17
each.
20
Comparables 2 and 5 have a weight of 20%
18
each.
Comparable 4 has a weight of 30%. Feedback
Now, let's calculate the weighted values: Range = Largest value - Smallest value
Range = 92 - 75
Weighted value for Comparable 1 = P819,000 * Range = 17
10% = P81,900
Weighted value for Comparable 2 = P836,000 * 28. The monthly incomes (in thousands) of six
20% = P167,200 people are: 20, 18, 22, 25, 23, 20. What is the
Weighted value for Comparable 3 = P827,000 * mode of their incomes?
10% = P82,700 7
Weighted value for Comparable 4 = P862,000 * 21.33
30% = P258,600 22
Weighted value for Comparable 5 = P848,000 * 20
20% = P169,600
Weighted value for Comparable 6 = P827,000 * Feedback
10% = P82,700 The mode is the value that appears most
frequently. In this case, the income of 20
Now, sum up all the weighted values: appears twice, which is more frequent than any
other value.
Total estimated value of the subject property =
Sum of weighted values 29. The ages of seven friends are as follows: 25,
Total estimated value = P81,900 + P167,200 + 28, 22, 30, 25, 27, 29. What is the mean age of
P82,700 + P258,600 + P169,600 + P82,700 the friends?
Total estimated value ≈ P842,700 20
27
The estimated value of the subject property, 26.57
based on the given weightings, is approximately 8
P842,700.

Feedback
Mean = (Sum of all values) / (Number of values)
Mean = (25 + 28 + 22 + 30 + 25 + 27 + 29) / 7 This means changes in price yield a significant
Mean = 186 / 7 ≈ 26.57 change in demand.
Unitary
30. The ages of a group of friends are: 20, 22, Inelastic
25, 30, 35, 40, 45. What is the median age of Perfectly Elastic
the friends? Elastic
30 Perfectly Inelastic
45 Correct answer
31 Elastic
25
36. If the percentage change in quantity
Feedback demanded divided by the percentage change in
To find the median age of the friends, we first price equals 1, it is known as ______.
need to arrange the ages in ascending order:
This means changes in price yield equivalent
20, 22, 25, 30, 35, 40, 45 (percentage) changes in demand.
Unitary
Since there are seven ages in total, the median Perfectly Elastic
will be the fourth value in the ordered list. In this Perfectly Inelastic
case, the median age is 30. Inelastic
Elastic
31. The following factors affect price elasticity of
demand, except: 37. As a rule of thumb, if the quantity of a
Utility product demanded or purchased changes more
Availability of Substitutes than the price changes, then the product is
Duration of Price Change considered to be ________.
Urgency Unitary
Perfectly Inelastic
32. If the percentage change in quantity Inelastic
demanded divided by the percentage change in Elastic
price equals infinity, it is known as ______. Perfectly Elastic

This means changes in price result in demand 38. One that examines the price-quantity
declining to zero. relationship for an individual consumer, or how
Elastic much of a product an individual will buy given a
Inelastic particular price.
Unitary Market Demand Curve
Perfectly Inelastic Individual Demand Curve
Perfectly Elastic Demand Elasticity
Consumer Curve
33. If the percentage change in quantity
demanded divided by the percentage change in 39. The summation of the individual demand
price equals 0, it is known as ______. curves in a given market. It shows the quantity
of a good demanded by all individuals at varying
This means changes in price yield no change in price points.
demand. Demand Elasticity
Unitary Consumer Curve
Elastic Individual Demand Curve
Perfectly Elastic Market Demand Curve
Perfectly Inelastic
Inelastic 40. A non-luxury product for which there is no
viable substitute—for example, a staple food,
34. If the percentage change in quantity like bread or rice.
demanded divided by the percentage change in Giffen Goods
price is less than 1, it is known as ______. Veblen Goods
Emblement
This means changes in price yield an Goodwill
insignificant change in demand.
Unitary 41. Generally luxury items, such as cars, yachts,
Elastic fine wines, and designer jewelry, that are high
Inelastic quality and out of reach for the majority of
Perfectly Inelastic consumers.
Perfectly Elastic Giffen Goods
Veblen Goods
35. If the percentage change in quantity Assets
demanded divided by the percentage change in Opulentia
price is greater than 1, it is known as ______.
42. According to the Law of Demand, the
quantity of a product purchased varies 50. In a court proceeding where the
_________ with its price. Appraiser/Valuer is presented as expert witness,
Conversely which report is most appropriate at the moment?
Inversely Deposition Report in Writing
Directly Oral Report
Conspicuously Short Letter Report
A Full Narrative Report or Form Report
43. This represents the relationship between the
price of a good or service and the quantity 51. The following are types of appraisal reports
demanded for a given period of time. according to the PVS. Which one is no longer
Demand Curve allowed under the Real Estate Service Act?
Free Market Written Report
Economy Oral Report
Supply Curve Form Report
Narrative Report
44. Typically, as the price of a product
increases, the quantity supplied also increases. 52. The TWO RULES ON STANDARDS says:
The resultant curve slopes 1. Follow the STANDARDS. 2. Follow the
_________________. Standards.
Downward from left to right 1. Follow the STANDARDS. 2. If the Standards
Downward from right to left are wrong, repeat the Standards.
Upward from right to left 1. Follow the STANDARDS. 2. Disregard the
Upward from left to right Standards.
Correct answer 1. Follow the STANDARDS. 2. If the
Upward from left to right Standards are wrong, refer to Rule No. 1.

45. This is a clay-based unglazed or glazed 53. A valuation review performed by a Valuer to
ceramic, where the fired body is porous. form an opinion as to whether the analysis,
Shingles opinions, and conclusions in the report under
Terra Cotta review are appropriate, reasonable, and
Tegulla supportable.
Balluster Technical Review
Desk Review
46. Gunite is: Field Review
Pneumatically placed concrete usually Administrative Review
associated with in-ground pools
A type of insulating material 54. Communicates to users and third-party
A type of roof shingle readers the value conclusion and confirms the
Part of a staircase basis of the valuation, the purpose of the
valuation, and any assumptions or limiting
47. Gross living area is: conditions underlying the valuation:
Commonly used in residential properties Appraisal Report
Commonly used in industrial properties Certificate of Value
Commonly used in apartments Value Declaration
Commonly used in retail centers Valuation Report

48. When Valuation Reports are transmitted 55. The following statements are true when
electronically, a Valuer should ensure the applied to Valuation Standards except:
following except: Standards are statements of recognized
Take reasonable steps to protect the integrity of principles and concepts
data Standards prescribe specific methods of
Take steps to ensure no error is made in valuation for different purposes
transmitting Standards are statement of best practice in
Take reasonable steps to protect the text in the procurement and reporting
report Standards are statements of accepted
Takes care of the cost of transmitting the definitions
report
56. In International Financial Reporting
49. The following are some of the minimum Standards (IFRS), this term refers to the amount
requirements of a Valuation Report except: for which an asset could be exchanged between
The Acceptable Principles in the analysis of knowledgeable, willing parties in an arm's length
Data transaction.
The Identify of Property, Location, and Interest Fair Value
The identify of Client, Valuer, and Date of Value in Use
Report Value as a going concern
The instructions, Date of Value, Purpose or Investment Value
Intended Use
57. IFRS adopted two models for the recognition 8 Years
of property assets in the balance sheet, namely: 12 Years
A Market Value Model and Historic Model
An Investment Model and Market Model 65. The remaining economic life of Atty. Duane's
A Fair Market Model and Market Value Model residence described above is:
A Cost Model and Fair Value Model 100 Years
48 Years
58. Conclusion as to the Highest and Best Use 52 Years
is part of which step? 60 Years
Analyzing the Data
Making the Final Estimate of Value 66. Normal life expectancy of Atty. Duane's
Preliminary Analysis residence described above is:
Defining the Appraisal Problem 100 Years
60 Years
59. What aspect of the feasibility study analysis 12 Years
separates it from the real estate 8 Years
appraisal/valuation?
The Viewpoint of the Owner of its best use 67. A value of a building with a first year net
General Supply and Demand Analysis operating income of P 200,000 and with an
Estimation of an Absorption Rate overall capitalization rate of 9.52% is:
Evaluation of the Rate of Return on Investment P 2,100,000
P 2,200,000
60. If the Client wants to know the land use P 2,100,840
pattern of an area or community, a ________ is P 2,300,840
probably needed.
Comprehensive Land Use Plan Study Feedback
Highest and Best Use Study V= I/R
Real Estate Appraisal/Valuation Report V= 200,000 / 9.52%
Re-Use Appraisal Study V = P 2,100,840

61. If the subject property is 10% superior to the 68. A parallel beam is known as:
comparable sale and the comparable was sold A girder
for P1,000,000, what is the indicated value of A jamb
the subject? A joist
P 1,000,000 / 1.10 = P 909,000 A batten
P 1,000,000 x 0.90 = P 900,000
P 1,000,000 / 0.90 = P 1,111,111 69. That piece of metal which protect a structure
P 1,000,000 x 1.10 = P 1,100,000 from water seepage is called:
Downspout
62. The appropriate adjustment for time is Flushing
determined to be 9% per year. The time Coving
adjustment for a comparable property that was Gutter
sold a year ago for P 100,000 per square meter
is: 70. In conventionally constructed house, the
Plus P 9,000 per square meter highest member of the frame is:
Less P 9,000 per square meter Girder
Plus P 6,050 per square meter Rafter
Less P 6,000 per square meter Collar Beam
Ridge Board
For Nos. 63 - 66. Correct answer
Ridge Board
Atty. Duane's House in Dasmariñas Village is 12
years old but has been well cared for, that it is in 71. A house with two levels of Living area
good condition as a typical 8-year old property. characterized by a steep roof slope and
Residences in this area typically last for 60 dormers, in which the area of the upper level is
years, and even that life span maybe extended 40% - 60% of the lower level is classified as a:
with extensive renovation. One and a half storey
Slit Level
Effective age of the residence is: Two Storey
100 Years One Storey
12 Years
60 Years 72. This comprise of thin, small sheets of
8 Years waterproof materials used as surfacing materials
on roofs and walls:
64. The chronological age of Atty. Duane's Shake
residence described above is: Tegula
100 Years Placa Romana
60 Years Shingles
 80. The Office of the Municipal Assessor was
73. This effective gross income less operating created in:
expenses and sometimes less capital expenses 1977
and reserves for replacement, is the amount of 1976
money the owners of the real estate would 1978
expect to put in their pockets after paying 1979
expenses but before paying the mortgage 81. Declaring newly acquired, newly built, or
payment and the income taxes. newly transferred real property is required under
the following conditions, but not:
It is the estimated amount that is divided by the Conversion of presently taxable properties to
capitalization rate to produce a value estimate in exempt
“IRV” ratio analysis. Demolition of buildings or other structures
Effective Gross Income Change in classification and/or Correction in
Net Operating Income area
Potential Gross Income Dismantling and cessation of operation of
Profit machinery

74. Refers to enforced proportionate 82. Under local government code, the local
contribution/s imposed by the legislature upon government/sanggunian can set the assessment
person, property or interest within its jurisdiction levels which can be prescribed through
for the purpose of supporting government and all ordinance at:
its public needs. Regular Rates
Taxation Maximum Rates
Real Property Tax Minimum Rates
Taxes Standard Rates
Special Education Fund Tax Correct answer
Maximum Rates
75. The earliest forms of property taxation were
employed by the: 83. Real property shall be appraised at its
Spaniards current and fair market value based on the duly
Americans approved or enacted:
Japanese Classification of Real Properties
Roman Empire Schedule of Fair Market Values
Tax Map
76. This became the earliest forms of “tax rolls” Assessment Roll
listing the taxability of land, farm implements,
money, clothing, and transport and cargo modes 84. The appraisal and assessment of real
such as ships, carriages, and mules. property shall be:
American Census Standard
Greek Census Regular
Spanish Census Equitable
Roman Census Uniform

77. The Spanish “encomienda system levied 85. Which of the following rules in the appraisal
taxes on male tenant farmers of military age (16 of urban lands for taxation purpose is not true?
– 60) in a form of tribute or _________ for the Stripping method shall not be applied on
privilege of working the land. commercial and industrial properties
Special Tax Stripping method shall not apply to corner lots
Income Tax Stripping method and standard depth – applies
Property Tax only to residential lots
Personal Tax Stripping method shall apply to commercial
lots
78. The short-lived “1st Philippine Republic of
1898" provided for a system of realty taxation 86. Roads and streets, unless donated or turned
but was not implemented completely under the: over to local authorities shall be valued on the
Philippine Constitution basis of the cost of cementing, asphalting, or
Malolos Constitution paving with gravel and sand per square meter
Republic of Biak-na-Bato and shall be listed in the name of:
Commonwealth Constitution Local Government Unit

79. This Code became the basis of the Real Homeowner Association
Property Tax Administration System in the Barangay Council
Philippines in 1974. Subdivision Owner
Valuers Code
Real Property Tax Code 87. The Rule for adjustment of Triangular lots
National Property Tax Code with its base on the street is:
Real Property Code
Reduce the irregular lot to the nearest
equivalent rectangular, triangular and 93. The Rule in the appraisal of machinery and
trapezoidal sectors and apply the foregoing rules equipment with respect to the pricing and
Compute the value of the rectangular and estimating the cost of reproduction includes all
triangular portions separately according to the or any of the following, but not:
rules hereof, then get the summation Cost of machine, auxiliaries and/or optional
Compute as a rectangular lot then take 2/3 of accessories
the resultant value Brokerage, arrastre, heavy lifts, Customs duties,
Compute as a rectangular lot then take 1/3 of taxes and installation
the resultant value Freight, Insurance, Bank charges
Cost of demobilization
88. The Rule for adjustment of Triangular lot
with its apex on the street is: 94. All assessments made after the 1st day of
Compute as a rectangular lot then take 2/3 of January of any year shall take effect on the 1st
the resultant value day of the succeeding year, provided, however,
Reduce the irregular lot to the nearest that the reassessment of real property due to its
equivalent rectangular, triangular and partial or total destruction, or to a major change
trapezoidal sectors and apply the foregoing rules in its actual use, or to any great and sudden
Compute as a rectangular lot then take 1/3 of inflation or deflation of real property values, or to
the resultant value the gross illegality of the assessment when
Compute the value of the rectangular and made, or to any other abnormal causes, shall be
triangular portions separately according to the made within:
rules hereof, then get the summation 90 days from the date any such cause or
causes occurred; the same to take effect at
the beginning of the quarter next following
89. The Rule for adjustment of Irregular lot is: the reassessment
Compute as a rectangular lot then take 1/3 of 120 days from the date any such cause or
the resultant value causes occurred; the same to take effect at the
Compute as a rectangular lot then take 2/3 of beginning of the quarter next following the
the resultant value reassessment
Reduce the irregular lot to the nearest
equivalent rectangular, triangular and 30 days from the date any such cause or causes
trapezoidal sectors and apply the foregoing occurred; the same to take effect at the
rules beginning of the quarter next following the
Compute the value of the rectangular and reassessment
triangular portions separately according to the 60 days from the date any such cause or causes
rules hereof, then get the summation occurred; the same to take effect at the
beginning of the quarter next following the
90. The Rule for adjustment of Trapezoidal lot is: reassessment
Compute the value of the rectangular and
triangular portions separately according to 95. The distribution of the collected real property
the rules hereof, then get the summation tax proceeds in case of provinces shall be:
Compute as a rectangular lot then take 2/3 of Province, 30%: Municipality, 40%: Barangay,
the resultant value 30%
Reduce the irregular lot to the nearest Province, 35%: Municipality, 35%: Barangay,
equivalent rectangular, triangular and 30%
trapezoidal sectors and apply the foregoing rules Province, 35%: Municipality, 40%: Barangay,
Compute as a rectangular lot then take 1/3 of 25%
the resultant value Province, 30%: Municipality, 35%: Barangay,
35%
91. According to the Rule in the appraisal of
agricultural lands for assessment purpose, RA 96. The distribution of the collected real property
7160 has no specific provisions on the valuation tax proceeds in case of cities shall be:
and assessment of: City, 80%: Barangay, 20%
Plants and Trees City, 85%; Barangay, 15%
Farm Lands City, 70%; Barangay, 30%
Rawlands City, 75%: Barangay, 25%
Agricultural Lots
97. The distribution of the collected real property
92. Agricultural lands convertible into residential tax proceeds in case of MM/Municipality shall
subdivisions or industrial use shall be classified be:
and valued until such time that they shall have
been actually converted and developed into MMDA, 35%; Municipality 30%; Barangay, 35%
such, as: where 50% to host barangay
NOTA MMDA, 40%; Municipality 35%; Barangay, 25%
Residential where 50% to host barangay
Agricultural MMDA, 35%; Municipality 35%; Barangay,
Industrial 30% where 50% to host barangay
MMDA, 30%; Municipality 35%; Barangay, 35%
where 50% to host barangay

98. The device that the user interacts with

directly in carrying out GIS operation.
People
Geographic Information System
Hardware
Software

99. Refers to the use of satellites and aircraft to

capture information about the earth’s surface.
Geographic Information (GI)
Geographic Information Systems (GIS)
Remote Sensing (RS)
Global Positioning Systems (GPS)

100. Specifies and describes location, stored in

a shape file in Arcview and answers the
question where.
Database
Spatial Data
Attribute Data
Data
 b. HUDCC
REAL ESTATE FINANCING c. HMDF
d. PDIC
1. A sale in form but mortgage in substance 2. The form of deed used to return title to real
a. Pacto de Retro estate to its owner when the debt secured by
b. Pacto de Non Aliendo a deed of trust is paid in full is the
c. Pactum Commissorium a. warranty deed
d. Dacion en Pago b. quitclaim deed
2. The period for right of redemption for c. reconveyance deed
corporations is d. tax deed
a. 1 year if habitually engaged 3. Tenancy by the entirety is a form of
b. 1 month a. marital property ownership
c. 3 months b. business property ownership
d. 1 year c. tenancy in common
3. In a judicial foreclosure, the owner o a d. ownership in severalty
property has 3 months before approval of 4. The four unities required for a joint
court order to redeem his/her land. tenancy include
a. Right of redemption a. tenancy, location, title, and possession
b. Reglamentary period b. time, title, interest, and possession
c. Equity of redemption c. possession, ownership, use, and
d. Prescriptive period enjoyment
4. It is the study of the production, distribution d. title, time, location, and possession
and consumption of goods and services. 5. A life estate is a(n)
a. Geography a. present, possessory interest.
b. Accounting b. estate of tenancy.
c. Statistics c. future interest.
d. Economics d. fee simple defeasible.
5. Where buyers and sellers meet to exchange 6. During the research of a subject property an
trade goods and services with valu at appraiser learns the occupants (parents)
negotiated prices. have been granted a life estate by their
a. Economy children. What interest do the children hold in
b. Market the property?
c. Industry a. Remainder man
d. Negotiation b. Trustee
6. There are more sellers and few buyers c. Life tenant
a. Seller’s market d. Trustor
b. Oligopsony 7. Property acquired by a spouse during
c. Buyer’s market marriage by gift or inheritance is
d. Oligopoly a. marital property
7. The main participants in a real estate market b. separate property
are: c. community property
a. Consumers, producers and d. jointly owned property
distributor’s 8. A deed of trust is
b. Owners, renters facilitators a. A document that makes a third party
c. Distributors, renovators developers responsible for the money
d. Users, facilitators, managers b. A document that gives a third party the
8. The following are agents of production deed until the mortgage loan is paid
except off
a. Land c. A deed given by a prisoner who has
b. Purchase power behaved for many years
c. Labor d. Used as a tool to make foreclosure more
d. Entrepreneurship efficient
9. That value concept that states that human 9. Based on net gift the maximum rate of donor
labor is the sole creator of value. tax is (2021)
a. Social theory of Mill a. 6%
b. Cost theory of Adam Smith b. 15%
c. Labor theory of Marx c. 10%
d. Scarcity theory of Malthus d. 30%
10. That value concept that states that land 10. The rate of real estate tax in municipalities
value increases indefinitely. within metro manila is not more than
a. Social theory of Mill a. 5%
b. Cost theory of Adam Smith b. 10%
c. Labor theory of Marx c. 2%
d. Scarcity theory of Malthus d. 20%
1. The agency that now insures deposits in 11. Under the local government code,
financial institutions is agricultural lands of more than one hectare
a. BSP
 are subject to additional tax of no more than d. at the time payment of capital gains tax
5% of assessed value when at lest 20. Value placed on taxable property by the
a. entire area is uncultivated assessor for ad valorem tax purpose
b. 50% of the area is uncultivated a. economic value
c. 30% of the area is uncultivated b. assessed value
d. 20% of the area is uncultivated c. appraised value
12. Annual levy on real estate equivalent to 1% d. market value
of the assessed value which shall be in 21. The property sold is an ordinary asset, what
addition to the basic real estate tax is the applicable tax
a. ad valorem tax a. estate tax
b. special education fund tax b. capital gains tax
c. excise tax c. percentage tax
d. vat d. creditable withholding tax
13. Capital gains on the sale of real estate 22. Tax fixed on documents, instruments and
classified as capital asset is papers evidencing acceptance, assignment
a. prepaid income tax or sale of a right, property or obligation
b. expanded withholding tax a. community tax
c. creditable tax on sale b. excise tax
d. creditable tax on sale c. estate tax
14. BIR revenue regulation no 17-2003, the d. documentary stamp tax
seller of a family home who failed to utilized 23. Banks acquired assets which form part of its
the proceeds to acquire a new residence real estate inventories at the close of its
within 18 months from the sale shall be accounting period shall be classified
assessed additional deficiency capital gains a. ordinary asset
tax inclusive of penalties and b. fixed asset
a. 5% p.a. c. capital asset
b. 20% p.a. d. tangible asset
c. 25% p.a. 24. Sale of a dealer of a residential dwelling is
d. 10% p.a. not subject to VAT when the price does not
15. Ground floor of a condominium project per exceed (2021)
BIR 28-29 shall be considered as a. 1,500,000.00
commercial and a additional rate shall be b. 1,000,000.00
added on established residential zonal value c. 2,500,000.00
of d. 3,199,200.00
a. 20% 25. Which of the following cannot be issued
b. 15% condominium certificates of titles
c. 10% a. subdivision lots
d. 25% b. two level row house
16. The estate tax return shall be filed with the c. one level raw house
BIR within d. industrial warehouse
a. 90 days from the death of the decedent 26. The required number of votes of registered
b. 120 days from the death of the decedent owners to authorize a condominium
c. 60 days from the death of the decedent corporation to sell or otherwise dispose of
d. 180 days from the death of the the common areas in a condominium project
decedent is
17. Taxpayer has__ to redeem his real property a. unanimous votes
which was levied and subsequently forfeited b. Simple majority votes
and acquired by the local government for tax c. 2/3 votes
delinquency d. 1/3 votes
a. 3 years 27. A space to be considered a condominium
b. 1 year unit
c. 5 years a. at least 5 storey high
d. 2 years b. manage by condominium corporation
18. The following composed the board of c. be susceptible to independent use and
assessment of Makati city, except owner ship
a. city assessor d. unencumbered by any restriction
b. register of deed 28. The right of an owner lessor to receive the
c. city treasurer contract rent and reversion of property at the
d. city engineer end of the lease is
19. Documentary stamp tax on the sale of a. fee simple
property must be paid b. lease fee estate
a. within 30 days from the date of c. net lease
notarization d. freehold
b. within 5 days after the close of the 29. An authority given by the developer to a
month of the date of sale broker to look for a supplier of backfilling
c. within 10 days after the close of the materials who shall be paid with developed
month of the date of sale lots is:
 a. Procurement agency b. 180 days from death of decedent
b. Sales agency c. 90 days from death of decedent
c. General Brokerage d. 240 days from death of decedent
d. None of the above e. 120 days from death of decedent
e. Exchange agency 38. Under the Local Government Code, the next
30. An agreement between an owner and a period for the property owner to file a sworn
broker to sell a real estate property: declaration of ownership and value with the
a. Listing assessor is:
b. Power of Attorney a. Year 2018
c. Authority to sell b. Year 2019
d. None of the Above c. Year 2020
e. Joint venture d. Year 2021
31. In the real estate business, another term for e. None of the above
the owner is: 39. The documentary stamp tax on the sale of
a. Customer property must be paid
b. Principal a. Within thirty (30) days from the date of
c. None of the above notarization
d. Prospect b. Within five (5) days after the close of
e. Alter Ego the month of the date of sale
32. The documentary stamp on lease of real c. Within ten (10) days after the close of the
estate is P6.00 for the first P2,000.00 or month of the date of sale
fraction thereof and additional (2021) d. At the time of payment of capital gains tax
a. P0.50 for every P1,000 in excess of the e. At any time
first P2,000 40. The ground floor of a condominium project,
b. P1.00 for every P1,000 in excess of the per BIR 28-98, shall be considered as
first P2,000 commercial and an additional rate shall be
c. P1.50 for every P1,000 in excess of the added on established residential zonal value
first P2,000 of:
d. P2.00 for every P1,000 in excess of the a. 10%
first P2,000 b. 25%
e. P3.00 for every P1,000 in excess of the c. 15%
first P2,000 d. 30%
33. Under BIR Revenue Regulation No. 17-2003, e. 20%
the seller of a family home who failed to 41. The schedule of fair market value in
utilize the proceeds to acquire a new municipalities in Metro Manila is prepared by:
residence within 18 months from the sale a. MMDA
shall be assessed additional deficiency b. Bureau of Internal Revenue
capital gains tax inclusive of penalties and: c. Concerned Municipal Assessor
a. 5% interest per annum d. Sangguniang Bayan by ordinance
b. 10% interest per annum e. None of the above
c. 15% interest per annum 42. The amount of family home equivalent to the
d. 20% interest per annum fair market value considered as allowable
e. 25% interest per annum deductions from the estate of the decedent
34. The rate of real estate tax in municipalities a. P 500,000.00
within Metro Manila is not more than b. P 1,000,000.00
a. One-half percent of assessed value c. P1,500,000.00
b. Three percent of assessed value d. P 2,000,000.00
c. One percent of assessed value e. P 750,000.00
d. None of the above 43. A taxpayer has ____ to redeem his real
e. Two percent of assessed value property which was levied and subsequently
35. Based on net gifts, the maximum rate of forfeited and acquired by the local
donor’s tax is: government for tax delinquency.
a. Ten Percent a. 1 year
b. Fifteen percent b. 60 days
c. Thirty percent c. 2 years
d. Twenty percent d. 4 years
e. Twenty-five percent e. 3 years
36. The value placed on taxable property by the 44. In case of foreclosure sale where right of
assessor for ad valorem tax purpose is: redemption is not exercised by the
a. Market Value mortgagor, who pays the capital gains tax?
b. Appraised Value a. Owner-mortgagor
c. Assessment Value b. Buyer of the property
d. Assessed Value c. None of the above
e. Economic Value d. Creditor-bank
37. The estate tax return shall be filed with the e. Any of the above
BIR within : 45. The documentary stamp on every mortgage
a. 60 days from death of decedent or pledge of real estate is: (2021)
 a. P40.00 for the 1st P5,000.00 plus d. Department of Human Settlement and
P20.00 for every P5,000.00 thereafter Urban Development
b. P10.00 for every P5,000.00 or fraction e. National Housing Authority
thereof 51. In the absence of any provision in the master
c. P15.00 for every P5,000.00 or fraction deed of a condominium project, the interest
thereof of the unit o owners in the common areas
d. P2.00 on each P200.00 or fraction thereof shall be:
e. None of the above a. Proportionate
46. In case of sale of agricultural lands not b. Decided by the condominium corporation
exceeding five (5) hectares, aside from c. Based on Value
clearance from DAR, buyer must also submit d. None of the above
what document? e. Equal
a. Undertaking to surrender land in excess 52. Urban Development and Housing Act:
of retention limits a. R.A. 7279
b. Affidavit of compliance with CARL b. R.A. 9279
c. Affidavit of total or aggregate c. R.A. 7927
landholding d. R.A. 7972
d. Certification from DAR e. None of the above
e. Affidavit of waiver 53. Condominium Act:
47. The retention limit of landowners under the a. R.A. 4727
CARP is: b. R.A. 4276
a. 5 has for the landowner and 3 has per c. R.A. 2774
child irrespective of age d. R.A. 4726
b. 5 has for the landowner and 3 has per e. None of the above
child who must be at least 15 years old 54. Document to be checked before buying a
c. 5 has for the landowner and 5 has per subdivision lot:
child whether or not they till the land or a. Development permit
manage the farm b. Map
d. 5 has for the landowner and 3 has per c. License to sell
child who must be at least 15 years old d. None of the above
and is actually tilling the land or e. Bureau of Land approval
managing the farm 55. Sometimes referred to as vertical
e. 5 has for the landowner and 3 has per subdivision:
child who must be over 21 years old a. Row Houses
48. A buyer of a subdivision lot on installment b. Mansion
after sufficient notice to the developer c. Town Houses
discontinued paying amortization because d. None of the above
the developer failed to develop the e. Condominium
subdivision as certified by the HLURB in 56. Subdivision and Condominium Buyers
such a situation and under P.D. 957, the Protective Decree:
buyer is entitled to a refund which would be: a. P.D. 1216
a. Total payment made less penalty b. P.D. 957
charges. c. B.P. 220
b. Total payments made less penalty and d. None of the above
interest charges. e. P.D. 1981
c. Total payments made less penalty 57. The area reserved for roads, alleys and open
charges plus interest on total payment. spaces in a subdivision project with an area
d. Total payments including penalty charges of one hectare or more is:
e. None of the above. a. 20% of gross area
49. Unless extended for justifiable cause, the b. 25% of gross area
period of completion of development of a c. 30% of gross area
subdivision project, counted from issuance of d. 35% of gross area
license to sell, is: e. None of the above
a. Six months 58. For a space to be considered a condominium
b. Eighteen months unit, it must:
c. Twelve months a. be encompassed by interior surface of
d. Twenty four months walls, floors and ceilings
e. None of the above b. be managed by a condominium
50. Registration of a mortgage covering a corporation
subdivision project or completion of c. be susceptible of independent use and
development of a subdivision project is at ownership
the: d. be unencumbered by any restriction
a. Local Government Unit e. at least five storeys high
b. Housing and Urban Development 59. In mixed use condominium project, the
Coordinating Council master deed may be amended by simple
c. Home Insurance Guarantee Corporation majority of unit owners. Majority is based on:
a. Number of condominium units
 b. Floor area of ownership b. Feb. 26, 1978
c. Total area of condominium units c. August 26, 1972
d. Any of the above d. March 12, 1976
e. None of the above 69. Under HDMF circular 189-C, a qualified
60. Amendment to the master deed of a Pagibig member can purchase residential lot
condominium project approved by majority of not exceeding
registered owners also need to be approved a. 500 sq.m.
by the city engineer and: b. 1,000 sq.m.
a. Local Government e. National Housing c. 750 sq.m.
Authority d. 1,500 sq.m.
b. Housing and Urban Development e. 250 sq.m.
Coordinating Council 70. Maximum amount of loan available under
c. Department of Human Settlement and Unified Home Lending Program
Urban Development a. 250,000.00
d. Land Registration Authority b. 375,000.00
61. Under the local government code, the c. 200,000.00
appraisal of the fair market value of real d. 500,000.00
property shall be based on e. 300,000.00
a. actual use 71. Zero Assessment level refers to an
b. independent appraisal value assessment of all building whose market
c. declaration of lot owner value does not exceed-_______ which are
d. assessed value exempted from payment of real property
62. When to pay Estate tax if the case is settled taxes
judicially a. 75,000.00
a. Not exceeding 2 years b. 175,000.00
b. not exceeding 10 years c. 125,000.00
c. Not exceeding 3 years d. 275,000.00
d. Not exceeding 5 years e. 150,000.00
e. Not exceeding 4 years 72. How often does the real property
63. When to pay Estate tax if the case is settled assessment be revised by the City/ Municipal
extra judicially assessor
a. Not exceeding 2 years a. every year
b. not exceeding 10 years b. 7 years
c. Not exceeding 3 years c. 3 years
d. Not exceeding 5 years d. 10 years
e. Not exceeding 4 years e. 5 years
64. Ecology solid waste management act is 73. A tax imposed on the sale, donation,
a. RA 9003 barter or any other mode of transferring
b. RA 9030 real property ownership or title
c. RA 467 a. simple fee/tax
d. RA 674 b. registration fee
e. RA 1096 c. filing fee/tax
65. It is the introduction of harmful substance or d. excise tax
by products into the environment e. transfer fee/tax
a. Degradation 74. Who is the chairman of LBAA or Local board
b. Pollution of assessment Appeal
c. Solid waste a. Provincial auditor
d. Contamination b. Register of Deeds
e. Discharge c. City Treasurer
66. It is a certification issued by the EMB d. Fiscal
certifying that based on the submitted project e. City Assessor
description, the project is not covered by the 75. Tax imposed on every citizen of the
EIS system and is not required to secure an Philippines
ECC a. excise tax
a. Environmental compliance certificate b. Real property tax
b. Feasibilty study c. documentary tax
c. Project impact study d. Ad valorem tax
d. Environmental impact study e. Community tax
e. certificate of non coverage 76. All real estate broker and private appraiser
67. what is EMB under the bureau of DENR shall be required to post a professional
a. a. Ecosystem Management bureau indemnity insurance/cash or surety bond, in
b. Environmental Management Bureau an amount with no less than_____, without
c. External Management bureau prejudice to additional requirement of the
d. Environmentally Management Bureau client. It will be renewable every 3 years.
e. Ecology Management bureau a. 2,000 pesos
68. The effectivity of Maceda law or RA 6552. b. 15,000 pesos
a. August 16, 1972 c. 5,000 pesos
 d. 20,000 pesos countries and securities issued by
e. 10,000 pesos multilateral agencies
77. a stock corporation established principally for e. all of the above
the purpose of owning income generating 85. Transfer of awarded lands from CARP is
real estate assets prohibited for a period of
a. real estate trust a. 5 years
b. real estate company b. 8 years
c. real estate investment trust c. 20 years
d. real estate investment corporation d. 15 years
e. Philippine stock exchange e. 10 years
78. The Real estate investment trust act 86. PD 1517 or Urban Land Reform Law an area
a. RA 9856 considered urban when it has a population
b. RA 9886 density of at least an area of.
c. RA 9865 a. 1,000 resident per sq.km. and at least
d. RA 9646 25% of active resident engage in non
e. RA 9586 agricultural activities
79. A real estate investment trust is a b. 2,000 resident per sq.km. and at least
a. a public company 50% of active resident engage in non
b. upon and after listing, have at least 1,000 agricultural activities
public shareholders c. 1,500 resident per sq.km. and at least
c. maintain as a listed company in sec/pse 50% of active resident engage in non
d. nota agricultural activities
e. all of the above d. 2,000 resident per sq.km. and at least
80. Real estate investment trust must distribute 70% of active resident engage in non
annually at least ______ of its distributable agricultural activities
income as dividends to its shareholder e. 1,000 resident per sq.m. and at least 25%
a. 50% of active resident engage in non
b. 20% agricultural activities
c. 75%
d. 90%
e. 40% PART II: Professional Appraisal Practice
81. The price or value of property agreed upon SET Exam 1
the seller who is not is compelled to sell and
a buyer who is not compelled to buy, both 87. The present and future demand for a
knowing all material facts relative to the property and its absorption rate is considered
property and the transaction in a
a. appraised value a. letter in appraisal
b. assessed value b. market feasibility study
c. economic value c. market segmentation
d. fair market value d. highest and best used analysis
e. zonal value e. transmittal letter
82. The sale of or transfer of real property to real 88. The appraiser final estimate should be based
estate investment trust, which includes the on
sale or transfer of any and all security a. average of three value indications
interest thereto, shall be subject to. obtained by three approaches
a. 25% of the applicable DST b. weighing of the reliability of the
b. 10% of the applicable DST information analyzed in each of the
c. 75% of the applicable DST three approaches
d. 50% of the applicable DST c. the most sophisticated guess technique
83. Income payment to real estate investment d. adjustment for most recent indicators in
trust shall be subject to a lower creditable the local market
withholding tax of 89. the appropriate time adjustment is concluded
a. 5% to be an increase of 7% per year
b. 1% compounded. The time adjustment for a
c. 10% comparable sales property that should for
d. 7.5% 80,000.00 two years ago.
e. 2% a. 11,529
84. Real estate investment trust may only invest b. 11,200
in c. 9,200
a. real estate related asset d. 91,592
b. debts securities, manage funds and listed e. 5,600
shares issued by local or foreign non 90. the criteria for determining the highest and
property corporations best used include all of the following
c. real estate located in the phils EXCEPT
d. government securities issued in behalf of a. physical possibility
the GRP or the government of the other b. probable use
c. financial feasibility
 d. effect on community welfare d. consistent used
e. legal permissibility e. conformity
91. the broad forces affecting value do not 98. the fee for an appraisal assignment is
include a. based on a percentage of the final value
a. physical estimate
b. social b. agreed upon during the preliminary
c. life cycle study stage
d. economic c. determined after the appraisal is
e. political completed
92. the certification of value section of an d. set by the fee schedule of the local board
appraisal report states everything EXCEPT of realtors
that e. set by a fee scale from real estate
a. the appraiser has no interest in the commission
property 99. the last step in the appraisal report is to
b. the fee is not contingent upon any aspect a. write the report
of the report b. reconcile all data
c. the facts are correct to the best of the c. analyze the data
appraiser knowledge d. inspect the property
d. last year the property was appraised e. set the fee to be charge
by the another person 100. the form of which a formal appraisal is
e. the property was personally inspected by presented is called
the appraiser a. a presentation of value
93. one implication of competition and excess b. an appraisal log
profit is that c. an appraisal report
a. there is a certain optimum combination of d. a value certification
land, labor, capital and entrepreneurship e. a narrative report
b. an estimate of value should be based on 101. a formal appraisal must include the
future expectation a. date of value estimate
c. abnormally high profits cannot be b. signature of the appraiser
expected to continue indefinitely c. identification of property appraised
d. maximum value accrues to real estate d. certification
when social and economic homogeneity e. all of the above
are present in a neighborhood 102. the highest and best used of land as if
94. cost indexes offered by standardized vacant forms part of the basis for
services are used to a. mortgage-equity analysis
a. derive units of comparison b. property rights adjustment
b. catalog building component c. an operating expense estimate
c. estimate operating expenses d. the cost approach
d. update past cost into current cost e. the square footage practice
e. estimate the local consumer price index 103. identifying and studying submarkets of a
95. a summary appraisal report larger market is called
a. contains many items that are not a. market research
considered in practice b. market survey
b. is an appraisal report prepared for a client c. market agglomeration
c. summarizes the item that might be d. market segmentation
used in practice e. market data
d. may be based on hypothetical or 104. the identification and study of a pertinent
assumed data market is called
e. should be prepared on a nontypical a. market analysis
property to appraisal practice b. neighborhood review
96. real estate in a submarket is c. property research
a. a group of sales person who deal mostly d. market reflection
in the same type of property e. market interaction
b. a group of sales that occur at the same 105. which of the following is important for
time good appraisal communication
c. a group of similar properties in the a. word choice
same area b. reading level
d. a small portion of the market of similar c. grammatical correctness
properties d. clarity
e. an area where sandwiches on French e. all of the above
bread are eaten 106. all of the following are true except
97. the fact that rents for equally desirable space a. real property is a type of service
tend to be set by the market reflects the b. value is dependent on market condition
principle of c. a good or service has no value in
a. balance exchange unless it possesses certain
b. substitution economic and legal characteristics
c. externalities
 d. the price representing value is usually c. letter report
quoted in terms of money d. narrative demonstration report
e. Real estate may be sold for all cash or e. unbiased report
financed 114. the principle of ______states that buyer will
107. in estimating the market value of comparable not pay more for the a site than for another
sale, an appraiser must consider all of the equally desirable one
following EXCEPT a. anticipation
a. whether the transaction was made in b. imbalance
cash, terms equivalent to cash, or other c. substitution
precisely revealed terms. d. balance
b. Whether the property had reasonable e. conformity
exposure in a competitive market 115. the principle of anticipation is
c. Whether a fair sale was transacted, with a. future oriented
neither the seller nor the buyer acting b. past oriented
under duress c. the as of date of appraisal
d. Whether the replacement cost of the d. anticipated loan to value ratio for the
property corresponds to its market subject property
value e. similar to the principle of substitution
e. Whether the seller was related to the 116. the principle of_______states that the value
buyer levels are sustained when the various
108. in preparing the appraisal report, your elements in an economic or environmental
analysis concludes that one of the mix are in equilibrium
approaches to value is not applicable to this a. anticipation
particular case. You should b. equivalence
a. omit the approach all together c. substitution
b. base the approach on hypothetical data d. balance
c. state that the approach is not relevant e. highest and best used
d. state that the approach is not 117. price and value are
applicable, explain the reason for this a. not necessarily the same
contention b. synonymous
e. find another approach so as to include c. different, depending on financing terms
three approaches d. almost the same in an active market
109. in the cost approach the site is valued as if it e. interchangeably in a report
were 118. the purpose of a ____ is to analyzed a
a. vacant and available for development property potential for success
to its highest and best use a. feasibility study
b. improved and suited for its intended use b. marketability study
or development c. market segmentation study
c. developed and operating d. appraisal report
d. attractively landscape e. need study
e. without nearby utilities 119. a use must be_____ to be considered as a
110. investment value is best describe as possible alternative for highest and best used
a. market price a. physically and legally possible and
b. market value financially feasible
c. the cost of acquiring a competitive b. physically and legally possible
substitute property with the same utility c. Already in existence and legal
d. the present worth of anticipated future d. Physically possible and appropriate
benefits to a certain entity e. Legal and profitable
e. value in exchange 120. an appraiser
111. location decision involve analysis on a. determines the price
which three level b. defends value
a. general, specific, detailed c. estimates price
b. country, state, community d. estimates value
c. residential, commercial, industrial e. determines value
d. country, state, county 121. the objective of the appraisal should be
e. region, neighborhood, site stated in the report
112. the length of a tract of land along a street is a. the market needs it
called b. it define the problems and identifies
a. depth the value sought
b. width c. it identifies the function of the report
c. frontage d. it absolves the appraiser of liability
d. abutment e. there are too many definitions of market
e. lineage price
113. the most comprehensive type of appraisal 122. the value estimate provided in an
report is appraisal
a. form report a. changes with the use to which it is put
b. oral report b. changes with the function of the appraisal
 c. remains the same regardless of use e. a good deal
d. depends upon the use or function of the 132. What of the following is true about zoning
appraisal a. it reflects the expectation that government
e. always reflects market value will preserve property values
123. population increases______demand for b. it is based on the right of government
housing to regulate for health, moral, welfare
a. depress the and safety
b. are incapable of simulating the c. it is inappropriate for parcels withed uses
c. have no effect on the d. it represents an effort to establish the
d. are likely to create a land highest and best use
e. are determined by the e. it represent the right to reuse the property
124. environment hazards that an appraiser must 133. for an appraiser to use the assistance of
be conscious of include all of the following another appraiser is
except a. inconsiderate
a. asbestos b. unethical
b. radon c. illegal
c. drano d. ETHICAL
d. urea formaldehyde e. questionable
e. PVC 134. it is_________to provide a value range to a
125. In analyzing the environment and market client who request it and understand its
area, it is best to meaning and use.
a. start at the general level and work a. foolish
down to the specific b. appropriate
b. start at the specific and work up to the c. un ethical
general level d. approximate
c. limit the analysis to the national level e. difficult
d. limit the analysis to the local level 135. any recent sale of a subject property
e. generally consider the traffic flow being appraised
126. the first step in general process is to a. should be considered confidential
a. define the problem b. cannot, under any circumstances, be
b. gather data considered in estimating the current
c. analyze data market value of the property
d. determine the approaches to value c. should be discussed in appraisal
e. make a final value estimate report
127. combining to or more sites in order to d. was not an arms length sale
develop one site with a greater value than e. should be used as comparable sale,
the individual sites have separately called though adjusted for its time and terms
a. synergy 136. the dimensions of a warehouse are
b. plottage customarily measured from
c. surplus land a. a roof line
d. excess land b. the midpoint of exterior wall
e. highest and best use of land c. the inside of finished wall
128. assemblage is d. the outside of finished wall
a. always reflect in the market value e. be reasonable or appropriate
b. the act of bringing to or more smaller 137. the construction of a luxury home in a
lots into common ownership for use neighborhood almost completely developed
c. inappropriate for parcels two or more with one and two bedroom apartments would
hectares a. produce external obsolescence
d. uneconomical b. be called an under improvement
e. illegal c. results in plottage value
129. typically, land is appraised by the d. results in neighborhood amenities
a. square foot e. be reasonable or appropriate
b. front foot acre a.
c. all of the above 138. price per front foot
d. none of the above a. a physical unit of comparison
130. it is_________for an appraiser to receive or b. not as accurate as price per acre
pay finders or referral fees c. rarely used in residential site analysis
a. reasonable d. an accurate guide to site marketability
b. unethical e. useful when there are few physical
c. necessary differences between sites
d. customary 139. which is the last step in reconciliation
e. convenient a. identify which of the three approaches is
131. a sale between relatives is considered used
a. an arms length transaction b. apply the three approaches to the data
b. a purely comparable sale collected
c. an open market sale c. apply to judgment to the data collected
d. a distorted sale d. review previous work and analysis
 e. select a final value of estimate expenses attribute to the property were 115
140. the highest and best use of the site is its per month?
a. existing use a. 75,670
b. most probable use b. 75,000
c. immediate next used c. 68,750
d. synonymous with ordinary and necessary d. 61,125
value e. 13,750
e. different from most probable use 149. Which of the following criteria most
141. markets in residential real estate are completely defines “highest and best use”?
a. equivalent to those for securities a. physically possible, legally acceptable,
b. related to physical boundaries and generating a higher present land
c. local value than any other use
d. physically obscure b. legally authorized, politically viable, and
e. found by courthouse sales socially acceptable
142. inflation tends to increase the value of c. physically possible, comparable to other
a. fixed income securities uses in the neighborhood, and legally
b. mortgages authorized
c. deeds in lieu of foreclosure d. comparable to other local uses, physically
d. real estate possible, and generating a higher present
e. debts land value that any other use
143. Real estate markets e. the tallest and most beautiful structure
a. are international in scope that can be placed on the land
b. meet none pf the criteria of a perfect 150. The total income anticipated from income
market property operations after vacancy and
c. are centralized in nature collection allowances and operating
d. consist of used property only expenses are deducted is
e. are well developed in former Communist a. net operating income
countries b. before-tax cash flow
144. The subject property has 85% occupancy. c. effective gross income
What conclusion would you most likely draw d. potential gross income
if the typical occup0nacy rate in the area was e. property residual income
95%? 151. Which principle of value best affirms that
a. Advertising is average. value is the present worth of expected future
b. The rents are high. benefits?
c. The rents are low. a. supply and demand
d. Management is good. b. balance
e. New construction will occur soon. c. substitution
145. The fact that the value of a property tends to d. anticipation
equal the cost of an equally desirable e. conformity
substitute is an example of the principle of 152. Which principle of value best affirms that the
a. balance maximum value of property generally cannot
b. substitution exceed the cost of its replacement?
c. contribution a. increasing and decreasing returns
d. diminishing returns b. supply and demand
e. supply and demand c. substitution
146. Population flow to different regions of the d. balance
United States will change primarily because e. anticipation
of 153. Which of the following would be classified as
a. changing economic opportunities a tangible rather than an intangible amenity?
b. environmental control legislation a. pride of ownership
c. rezoning legislation b. a sense of security
d. state tax policies c. a free dishwasher
e. air conditioning in the Sunbelt d. work satisfaction
147. When each alternative use requires the e. clean air
same capital investment, the use that 154. Which type of property is subject to ad
maximizes the investment’s______ on a valorem taxation?
long-term basis is the highest and best a. property owned by a religious
use. organization and used for religious
a. diversified portfolio purpose
b. operating expenses b. new industrial plants that state and local
c. net operating income governments have induced, with tax
d. potential gross income exemption as an incentive, to locate
e. occupancy rate within their jurisdictions
148. What would be the indicated value of a c. commercial property with more that
property that rented for 750 per month, using 50% nonprofit tenants
a monthly gross rent multiplier of 100, if the d. state colleges and universities
e. a state capitol
155. Compared with other assets, real estate is 163. Income capitalization is the term used to
a. immobile describe the process of estimating the value
b. expensive of income property by studying expected
c. long-lived future income. This process
d. mortgagable a. converts the net income of a property into
e. all of the above its equivalent capital value
156. All of the following are sources of b. reflects the time value of money by
comparable sales EXCEPT reducing or discounting future income into
a. public records its present worth
b. brokers c. focuses on the present worth of future
c. buyers and sellers benefits
d. mortgage servicers d. uses markets interest rates
e. appraisers e. all of the above
157. An allowance for vacancy and collection 164. to earn 12% on your investment, what should
loss is estimated as a percentage of you pay for a property earns 6,000.00 per
a. net operating income month and has operating expenses of
b. before-tax cash flow 1,250.00 per month
c. effective gross income a. 475,000.00
d. potential gross income b. 150,000.00
e. after-tax cash flow c. 229,166.00
158. The annual net operating income from an d. 333,333.00
apartment house is 11,000. If a capitalization e. 400,000.00
rate of 11% is used, the indicated market 165. The land development method is used to
value is estimate the value of vacant acreage that is
a. 126,000 ready to be subdivided. This method requires
b. 176,000 a. study of current sales of subdivided lots
c. 100,000 b. the projection of land of subdivided lots
d. 242,000 c. RTC approval
e. 2,420 d. Both A and B
159. which of the following is true of a gross e. None of the above
lease 166. a technique in income capitalization in which
a. the tenant pays all operating expense the analyst need not distinguish interest rates
b. the landlord pays all operating from capital recovery rates, but that is most
expense useful for comparable income
c. this lease is used only for commercial a. direct capitalization
properties b. building residual
d. rent rises with the cost of living c. land residual
e. this lease must be drafted by an attorney d. bank of investment
160. a forecast using discounted cash flow e. internal rate of return
analysis would include 167. cash on cash return is
a. income, vacancy and operating expense a. the annual cash flow divided by the
b. an economic analysis equity investment
c. reversion at the end of the holding period b. an internal rate of return that represents
d. discounting expected future cash flows to annual income and all gains or losses
a present value prorated to an effective annual amount
e. all of the above c. a percentage or decimal rate that, when
161. in discounted cash flow analysis, the divided into a periodic income amount,
reversion to be received at the end of the offers a lump-sum capital value for
holding period is income
a. a separate cash flow d. a value that does not change with time
b. an annuity in arrears e. none of the above
c. an ordinary annuity 168. Which report is usually NOT prepared by a
d. percentage of annual income real estate appraiser?
e. amount to be capitalized in perpetuity a. marketability study
b. economic study
c. feasibility study
162. a 1,000,000.00 property will have a 70% loan d. mineral valuation study
at an 8% annual mortgage constant. what e. highest and best use
must the NOI be to produce 12% cash on 169. Questions 86-89 based on the information
cash return below.
a. 120,000.00 You are appraising a 40-acre tract of
b. 56,000.00 unimproved by a real land. The size is zoned
c. 92,000.00 for single-family residential use. All utilities
d. 84,000.00 are available along the street on which the
e. 700,000.00 land fronts. The engineers who will plat the
proposed subdivision told you that 20% of
the land area will be used for streets and
 sidewalks. Zoning will permit four lots per 176. Net operating income is
acre of net developable land after deducting a. 1,224,800
streets. Research indicates that lots similar b. 184,800
to those that will be available on the subject c. 424,800
land will sell for 18,000 each and that the d. None of the above
entire tract can be developed and sold in 1 e. Cannot be calculated from the information
year. You find that 40% of the sale price of given
each lot must be allocated to selling cost, 177. Before-tax cash flow is
overhead, contingencies, carrying cost, and a. 1,030,000
developer’s profit, and that 2,000 feet of b. 184,800
streets (including water, storm sewer, and c. 194,800
sanitary sewer lines) must be installed at a d. None of the above
cost of 80 per foot. e. Cannot be calculated from the information
170. What is the number of lots to be developed? given
a. 40
b. 128 Questions 94-97 are based on the following
c. 80 information:
d. 88 178. A building contains 50 one-bedroom units
e. 32 and 150 two-bedroom units. The one-
171. What is the gross amount that will be bedroom units rent for 550 monthly; two
realized from the sale of all the lots? bedroom are 675. the vacancy rate is 7%;
a. 720,000 operating expenses are estimated at 40% of
b. 2,304,000 effective gross income. There is 2,000.00
c. 1,440,000 annual income for vending machines.
d. 1,584,000 179. potential gross income is
e. 576,000 a. 64,735
172. What is the cost of installing streets, water, b. 1,547,000
and sewer lines? c. 1,545,000
a. 16,000 d. 717,425
b. 32,000 e. None of the above
c. 64,000 180. effective gross income is
d. 160,000 a. 64,735
e. None of the above b. 1,547,000
173. What is the amount of selling cost, overhead, c. 1,545,000
contingencies, carrying cost, and developer’s d. 1,438,850
profit? e. None of the above
a. 921,6000 181. Net operating income is
b. 576,000 a. 64,375
c. 288,000 b. 268,970
d. 633,600 c. 863,310
e. None of the above d. 719,425
e. None of the above
Questions 90-93 are based on the 182. operating expense are
information below: a. 1,545,000
A 100-unit apartment complex includes 40 b. 54,075
one-bedroom units that rent for 950 and 60 c. 2,000
two-bedroom units that rent for 1,150 d. 719,425
monthly. The vacancy rate is 5%; e. 575,540
miscellaneous income is 5,000 annually. 183. in one step of the land value residual
Operating expenses amount to 400,000. The technique, the building capitalization rate is
mortgage loan requires payments of 630,000 applied to the known building value to
annually. estimate the
a. highest and best use of the site
174. Potential gross income is b. cost of the building
a. 1,289,000 c. income needed to support the land
b. 112,000 d. net operating income needed to support
c. 107,000 the building
d. 1,284,000 e. land value
e. Cannot be calculated from the information 184. the basic formula of property valuation via
given income capitalization is
175. Effective gross income is a. V=IR
a. 1,224,800 b. V=I/R
b. 1,220,000 c. V=R/I ?
c. 824,800 d. V=SP/GR
d. 107,000 e. V=I/F
e. Cannot be calculated from the information 185. all of the following lease provisions are
given advantageous to the lessee EXCEPT
 a. an escape clause e. a partial interest
b. a renewal option 194. A metes and bounds description begins and
c. a purchase option ends with the
d. an escalation clause a. street and house number
e. none of the above b. grid coordinates
c. block number
SET Exam 2 d. iron pin
e. point of beginning
186. In economics, the four factors of production 195. A (n) ____ identifies a property in such a way
are that it CANNOT be confused with any other
a. land, labor, capital, and improvements property.
b. land, labor, capital and a. coded map book
entrepreneurship b. full city survey
c. land, labor, capital and money c. legal description
d. land, improvements, labor and materials d. engineering report
e. land, labor, site, and improvements e. narrative appraisal
187. The law of supply and demand is 196. All of the following statements are true
a. a basic economic principle EXCEPT
b. legislated by Congress a. real property is a type of service
c. seldom used in the appraisal process b. value is dependent on market conditions
d. not a applicable in the short term c. a good or service has no value in
e. all of the above exchange unless it possesses certain
188. Which of the is NOT an agent of production? economic and legal characteristics
a. land d. the price representing value is usually
b. capital quoted in terms of money
c. transportation e. real estate may be sold for all cash or
d. entrepreneurship financing arranged
e. labor 197. All of the following will affect the market
189. Political forces affecting value may include value of a property EXCEPT
a. life-styles and living standards a. political factors
b. topography b. legal use restriction
c. athletic levels and recreation facilities c. acquisition cost to present owner
d. government spending and taxation d. economic factors
policy e. social concerns
e. primary registration and turnout 198. Market value is ____ the same as selling
190. What are the two categories of tangible price.
property? a. always
a. real property and personal property b. usually
b. intangible property and real property c. never
c. real estate and intangible property d. none of the above
d. legal and illegal investments e. sometimes
e. open and shut transactions 199. Price is
191. Zoning is an exercise of the a. market value
a. equity courts b. a historical fact
b. police powers c. most probable sales price
c. Environmental Protection Agency d. all of the above
d. Right of condemnation e. investment value
e. Right of escheat 200. Functional utility depends on
192. Which of the following types of property is a. zoning
subject to ad valorem taxation? b. wear and tear on the structure
a. property owned by a religious c. tastes and standards
organization and used for a religious d. age of the equipment
purpose e. insurance requirements
b. new industrial plants that state and local 201. Value in use is
governments have induced, with tax a. subjective
exemption as an incentive, to locate b. objective
within their jurisdictions c. readily measurable
c. commercial buildings leased in part by d. a market phenomenon
nonprofit foundations e. synonymous with market price
d. state colleges and universities 202. The value added to total property value by a
e. a state capitol particular component is an example of the
193. A person owning less than the entire bundle principle of
of rights has a. substitution
a. escheat b. contribution
b. personal property c. anticipation
c. a fee simple title d. conformity
d. a fee tail e. change
203. The concept that the value of a particular b. gather relevant data
components is measure by the amount that c. analyze the data
its absence would detract from the value of d. inspect the property
the whole is e. set the fee to be charged
a. opportunity cost 212. An appraisal is
b. contribution a. an estimate of net realizable value
c. substitution b. always concerned with the market value
d. conformity c. an appraiser’s opinion of market value
e. competition d. a precise statement of value
204. The market loss cause by depreciation in an e. a broker’s comparative sales analysis
older structure may be offset by all of the with further detail
following EXCEPT 213. The “as of” date in an appraisal report is
a. architectural interest a. the date to which the value applies
b. historical registration b. immaterial to the value estimate
c. strong demand relative to supply c. the date on which the report is delivered
d. strong supply relative to demand d. the date on which the property will be
e. renovation of the structure conveyed
205. Studying appraisal helps a person e. the anticipated closing date
a. to improve value estimation skills 214. Sales data descriptions of an appraisal report
b. to pass the real estate broker’s license contain
examination a. details about each comparable sale
c. to understand other real estate courses b. an analysis of the date, using the value
d. to communicate with appraisers approaches
e. all of the above c. the investigation of market forces
206. A dramatic change in short-term demand for d. analysis of the street each comparable
real estate in the local market is likely to property is on
immediately precipitate e. zoning details
a. construction 215. All of the following are ways to delineate
b. activity a neighborhood EXCEPT
c. price changes a. natural barriers
d. no change in supply b. streets
e. conversions c. utility service
207. The area and community analysis section of d. income characteristics
an appraisal report e. political boundaries
a. should “sell” the community 216. All of the following are sources of
b. should describe the community comparable sales EXCEPT
objectively a. public records
c. is a study by the estate’s industrial b. mortgage services
development commission c. brokers
d. considers the negative aspects only d. appraisers
e. considers the positive aspects only e. buyers and sellers
208. In analyzing the economic environment and 217. Which of the following criteria most
market area, it is best to completely define “highest and best use”?
a. start at the general level and work a. legally authorized, politically viable, and
down to the specific socially acceptable
b. start at the specific and work up to the b. physically possible, comparable to other
general level uses in the neighborhood, and legally
c. limit the analysis to the national level authorized
d. generally consider traffic flow c. physically possible, legally
209. Which of the following reports is usually NOT permissible, financially feasible, and
prepared by a real estate appraiser? generating a higher present land value
a. marketability study than any other use
b. economic study d. comparable to other uses in the
c. feasibility study neighborhood, physically possible, and
d. transportation network study generating a higher present land value
e. valuation study than any other use
210. An appraisal of a specific-purpose for e. the tallest and most beautiful structure
insurance purpose would depend most that can be placed on land
heavily on 218. The three basic approaches used to
a. book value estimate value are
b. highest and best use a. use, exclusion, and disposition
c. cost estimate b. cost, sales comparison, and use
d. specialty value c. cost, sales comparison, and market data
e. land value d. cost, sales comparison, and production
211. The first step in the appraisal process is e. cost, sales comparison, and income
to capitalization
a. define the problem to be solved 219. Units of comparison are used in
 a. only the sales comparison approach 228. For a building, effective age is best
b. only the cost approach defined as
c. only the income capitalization approach a. the average age of the roof
d. A, B and C b. the actual age divided by the age-life
e. the appraisal of special-purpose c. the ag of other property in equivalent
properties only condition and utility the chronological
220. Final value estimates should be rounded age of the building
to reflect the d. the chronological age of the building
a. absence of good data e. the period over which the building may be
b. property’s location effectively used
c. fact that a selling price will probably be a 229. The utility of real estate is its
round number a. attractiveness to the trained observer
d. lack of precision associated with an b. longevity
opinion c. capacity to satisfy human needs and
e. high value of real estate desires
221. When reconciling the adjusted sales d. effective demand
prices of comparables, the greatest e. remaining economic life
emphasis should be given to 230. In appraising a residence, adjustments are
a. the average NOT made to the comparable property for
b. the median a. age
c. the mode b. terms of sale
d. the mean of A, B, and C c. lot value
e. none of the above d. size
222. Which of the following forms of appraisal e. assessed valuation
report is NOT recommended? 231. When a site has improvements on it, the
a. completely filled-in institutional form highest and best use
b. telephone conversation a. is not definable
c. letter report b. is its existing use
d. long narrative report c. is its potential use
e. demonstration d. depends on whether or not the existing
223. Which of the following approaches would use is changeable
probably be given the most weight in e. may be different from its existing use
appraising a large office building? 232. To be considered as a comparable, a
a. reproduction cost property
b. income capitalization a. a must have been sold within the past 5
c. subdivision development years
d. market absorption b. must be competitive with the subject
e. replacement cost c. must have been sold by an open-
224. The form in which a formal appraisal is market transaction
presented is called d. must be a similar color
a. a presentation of value e. both B and C
b. a value certification 233. The direct sales comparison approach is
c. an appraisal log better than the income or cost approach
d. a narrative because
e. an appraisal report a. fewer comparable properties are require,
225. The form of an appraisal report so it is easier to outline the results to
a. has no influence on the appraisal clients
process b. there are fewer mathematical
b. is the same, regardless of the problem calculations, so there is less chance of
c. is set by the amount of the fee mathematical errors
d. is determined by the appraiser c. the market for real estate is slow to
e. determines the appraisal framework change
226. The effective age and the useful life of a d. it is always easier to obtain data for the
building represent judgments made by the direct sales comparison approach
a. appraiser e. none of the above true
b. buyer 234. The appraisal of an established 20-year old
c. property owner motel on a road with numerous competitive
d. insurer motels would most likely be based on the
e. tax assessor a. square foot are of improvements
227. The period over which existing b. number of units
improvements are expected to continue c. reproduction cost
to contribute to property value is their d. gross rent multiplier
a. effective age e. occupancy rate
b. period of diminishing returns 235. In applying gross rent multiplier analysis to
c. remaining economic life the subject property, the appraiser would use
d. chronological age the
e. remaining physical life a. market rental
 b. actual rent being paid a. land cost
c. rent currently asked by the owner b. cash equivalence
d. rent offered by a potential tenant c. cost to maturity
e. rent listed in advertising the property d. legal factors
a. e. depreciation
236. In estimating the market value of a 243. Economic obsolescence does NOT result
comparable sale, an appraiser must from
consider all of the following EXCEPT a. and outdate kitchen
a. whether the transaction was made in b. construction of a freeway near the
cash, terms equivalent to cash, or other property
precisely revealed terms c. the presence of an earthquake fault
b. whether the property had reasonable nearby
exposure in a competitive market d. building restrictions in the community
c. whether a fair sale was transacted, with e. factors external to the subject property
neither the seller nor the buyer acting itself
under duress 244. Reproduction or replacement cost
d. whether the replacement cost of the includes all of the following EXCEPT
property corresponds to its market a. an outdated kitchen
value b. construction of a freeway near the
e. whether the seller was related to the property
buyer c. the presence of an earthquake fault
237. The terms financing, whether good or nearby
bad, d. building restrictions in the community
a. have no effect on the market price e. factors external to the subject property
b. have no effect on the market value itself
c. have no effect on affordability 245. Reproduction or replacement cost
d. depend on fiscal and monetary policy includes all of the following EXCEPT
e. should be ignored when adjusting a. direct or hard costs
comparables b. indirect or soft costs
238. Adjustments to the property rights conveyed, c. entrepreneurial profit
financing, conditions of sale, date of sale, d. fixed and variable expenses of operations
and location are often made to the ____ of e. elevator shafts
the comparable property. 246. In analyzing obsolescence , the test of
a. unit price curability of a component in a building is
b. actual sales price whether the cost to cure is no greater than
c. price per square foot the
d. gross income multiplier a. expected increase in value
e. cash equivalent value b. reproduction cost new
239. Cumulative percentage adjustments may c. replacement cost
be used d. installation cost
a. when the characteristics are e. economic life of the new component
interdependent 247. Which of the following is NOT a type of
b. when the characteristics are independent depreciation?
c. when dollar figures are available a. entrepreneurial loss
d. when unimproved properties are being b. functional obsolescence
appraised c. external obsolescence
e. under no circumstances d. economic obsolescence
240. The best unit of comparison for vacant e. physical deterioration
land is 248. Estimation of occurred depreciation and
a. the square foot obsolescence does NOT involve
b. the total lot a. physical deterioration
c. a combination of square foot and front b. functional obsolescence
foot units c. economic obsolescence
d. the linear foot d. wear and tear
e. the unit considered important by the e. financial structure
market 249. In appraisal, accrued depreciation is really
a. an estimate of
241. In appraising a residential property by the a. physical deterioration
cost appraiser considers the b. capital recovery
a. sales prices of comparable properties c. diminished utility
b. deprecation of the land d. sinking fund factor
c. depreciation of improvements e. book depreciation
d. potential for new competition 250. The cost approach NOT useful for
e. potential misuse of this approach a. checking value approaches
242. In the cost approach, ____ is deducted b. appraising institutional or special-use
after estimating the cost to reproduce an properties
existing structure. c. estimating the value of new property
 d. appraising older homes in an active 258. Gross income multipliers are generally
market considered part of
e. insurance appraisals a. the cost approach
251. An appraisal of a freestanding store and b. the direct sales comparison approach
the land it occupies is an unbiased c. the income capitalization approach
estimate of the value of an interest in d. the insurance approach
a. personal property e. none of the above
b. mortgages 259. Use of a gross rent multiplier is valid
c. real estate when the subject and comparable
d. personal property and land properties have similar
e. real estate plus business value a. potential gross incomes
252. The term vertical interest does NOT refer b. operating expense ratios
to rights to c. effective gross incomes
a. subsurface mineral extraction d. cash flows
b. the construction and railroad tunnels e. net operating incomes
c. the use and regulation of air space 260. Time-distance relationship between a site
d. subdivision and development and all relevant origins and destinations
e. the construction of buildings over railroad are called
yards a. access roads
253. Inflation tends to increase the value of b. linkages
a. fixed-income securities c. transit facilities
b. tangible long-lived investments d. synergies
c. mortgages e. ingress and egress
d. debts
e. deeds in lieu of foreclosure 261. The land on which a 10-year-old house is
254. With an amortized mortgage loan, located is valued at P28,000, and the
a. interest only is paid until maturity reproduction cost of the dwelling is P92,000.
b. some principal is repaid with each Straight-line depreciation is 2% per year,
payment applied to the building only. If there is no
c. the entire principal is repaid before other obsolescence, what is the indicated
maturity value of the property?
d. equal amounts of principal are repaid a. P96,000
each period b. P117,700
e. there is a balloon payment at maturity c. P101,600
255. When each alternative use requires the d. P120,000
same capital investment, the use that e. P117,000
maximizes the investment’s ____ on a
long-term basis is highest and best use. 2% × 10 × 92,000 = 18,400
a. diversified portfolio 92,000 – 18,400 – 28,000 = 101,600
b. potential gross income
c. operating expenses 262. Effective gross income is income after an
d. occupancy rate allowance for
e. net operating income a. depreciation
256. Land purchased for 50,000 cash appreciates b. operating expenses
at the rate of 15% compounded annually. c. both A and B
About how much is the land worth after 5 d. none of the above
years? Disregard taxes, insurance, and e. cash expenditures
selling expenses. 263. In discounted cash flow analysis, the
a. 100,000 reversion to be received at the end of the
b. 37,500 holding period is
c. 87,500 a. a separate cash flow
d. 7,500 b. an annuity in arrears
e. 57,500 c. an ordinary annuity
257. A land speculator expects that a certain 100- d. a percentage of annual income
acre tract can be sold to a subdivider 4 years e. an amount to be capitalized in perpetuity
from now for 10,000 per acre. If holding and 264. To earn 12% annual cash return on a cash
selling costs are disregarded, what cash investment, what should you pay for a
price today (rounded to the nearest 1,000) property that earns 4,000 per month and has
would allow the speculator to realize a 15% operating expenses of 1,250 per month?
compounded annual rate of return on the a. 150,000
entire tract? b. 333,333
a. 572,000 c. 275,000
b. 6,000 d. 400,000
c. 5,000 e. 229,166
d. none of the above 265. In selecting an overall capitalization rate for
e. 600,000 an income-producing property, the appraiser
will consider all of the following EXCEPT
 a. return on invested capital 273. If a particular buyer requires as recapture of
b. risk factors the building portion of the purchase price in
c. return of invested capital 25 years, what is the indicated recapture rate
d. the interest rate on the existing loan, for the building, assuming straight-line
which was arranged last year recapture?
e. the interest rate prevailing in the market a. 0.25%
b. 20%
A 200-unit apartment complex includes 80 c. 2%
one-bedroom units that rent for 475 and 120 d. 25%
two-bedroom units that rent for 575 monthly. e. 4%
The vacancy rate is 5%; miscellaneous 274. In a high-rise, 100-unit apartment building
income is 5,000 annually. Operating there is a basement laundry area that brings
expenses amount to 400,000. The mortgage in 100 monthly from the concessionaire. The
loan requires annual payments of 630,000. laundry income is
266. Potential gross income is a. included, as miscellaneous income, in
a. 1,289,000 potential gross income
b. 107,000 b. included, as other income, in effective
c. 1,284,000 gross income
d. none of the above c. deducted from effective gross income
e. 112,000 d. added to before-tax cash flow
267. Effective gross income is 275. distributed to the maintenance workers This
a. 1,224,800 term refers to an official in the local
b. P107,000 government unit, who performs appraisal and
c. 1,220,000 assessment of real properties, including
d. none of the above plants, equipment, and machineries,
e. 824,800 essentially for taxation purposes.
268. Net operating income is a. Appraiser
a. 1,224,800 b. Assessor
b. 424,800 c. Consultant
c. 1,220,000 d. Broker
d. none of the above 276. A duly registered and licensed natural person
e. 824,800 who works in a local government unit and
269. Before-tax cash flow is performs appraisal and assessment of real
a. 1,030,000 properties, including plants, equipment, and
b. 194,800 machineries, essentially for taxation
c. 824,800 purposes is referred to as
d. none of the above a. real estate appraiser
e. 424,800 b. real estate broker
270. To obtain the present value of a series of c. real estate consultant
incomes, a (n) ____ rate is applied. d. real estate assessor
a. discount
b. equity capitalization 277. This term refers to a person who conducts
c. income valuation/appraisal; specifically, one who
d. stated possesses the necessary qualifications,
e. overall capitalization license, ability and experience to execute or
271. A fast-food chain could buy the building and direct the valuation/appraisal of real property.
land necessary for a new outlet for 200,000. a. Appraiser
Instead, an investor bought the property for b. Broker
this amount and lease it for 2,000 per month c. Assessor
over a 20-year term. Rent is payable at the d. Consultant
end of each month. What yield to maturity is 278. Defined as the physical land and
implied by the lease, assuming that, at the those human-made items, which
end of 20 years, the property is still worth attach to the land.
about P200,000? a. Real property
a. 8% b. Real estate
b. 14% c. Personal property
c. 10% d. Asset
d. 15% 279. The ownership of real estate is called
e. 12% a. bundle of rights.
272. When market rent is less than contract b. real property.
rent, the difference is known as c. fee simple.
a. overage rent d. freehold.
b. gross rent 280. Includes all the rights, interests, and benefits
c. excess rent related to the ownership of real estate.
d. slippage rent a. bundle of rights.
e. percentage rent a. real property.
b. fee simple.
 c. freehold. 290. This comparative approach considers
281. A term used for the amount asked, income and expense data relating to the
offered, or paid for a good or service. property being valued and estimates value
a. Cost through a capitalisation process.
b. Value a. Market data approach
c. Price b. Income approach
d. Replacement cost c. Cost approach
282. The price paid for goods or services or d. Residual technique
the amount required to create or produce 291. This comparative approach considers the
the good or service. possibility that, as an alternative to the
a. Value purchase of a given property, one could
b. Price acquire a modern equivalent asset that
c. Cost would provide equal utility.
d. Selling price a. Market data approach
283. An economic concept referring to the b. Income approach
price most likely to be concluded by the c. Cost approach
buyers and sellers. d. Building residual technique
a. Cost 292. A duly registered and licensed natural person
b. Value who, for a professional fee, commission or
c. Price other valuable consideration, acts as an
d. Market agent of a party in a real estate transaction to
284. The environment in which goods and offer, advertise, solicit, list, promote, mediate,
services trade between buyers and sellers negotiate or effect the meeting of the minds
through a price mechanism. on the sale, purchase, exchange, mortgage,
a. Market lease or joint venture, or other similar
b. Medium transactions on real estate or any interest
c. Stock exchange therein.
d. Appraisal a. Real estate appraiser
285. A statement of the fundamental b. Real estate salesperson
measurement principles of a valuation c. Real estate broker
on a specified date. d. Real estate developer
a. Market value 293. In asset valuation, this term refers to the
b. Selling price adjustments made to the cost of reproducing
c. Economic condition or replacing the asset to reflect physical
d. Basis of value deterioration and functional (technical) and
286. In markets characterised by extreme external (economic) obsolescence in order to
volatility or severe disequilibrium estimate the value of the asset.
between supply and demand, the highest a. Deterioration
and best use of a property may be a / an b. Depreciation
a. holding for future use. c. Replacement cost
b. interim use. d. Reproduction cost
c. existing use. 294. In property appraisal, these are suppositions
d. commercial utility taken to be true, involving facts, conditions,
287. Where land use and zoning are in a state of or situations affecting the subject (property
change, the immediate highest and best use being appraised), or the approach in the
of a property may be a / an valuation.
a. interim use. a. Assumptions
b. present use. b. Market conditions
c. residential use. c. Perceptions
d. commercial use. d. Observations
288. This principle holds that a prudent person 295. A duly registered and licensed natural person
would not pay more for a good or service who, for a professional fee, compensation or
than the cost of acquiring an equally other valuable consideration, offers or
satisfactory substitute good or service. renders professional advice and judgment
a. Principle of highest and best on: (i) the acquisition, enhancement,
b. Principle of anticipation preservation, utilization or disposition of
c. Principle of substitution lands or improvements thereon; and (ii) the
d. Principle of competition conception, planning, management and
289. This comparative approach considers the development of real estate projects.
sales, listings or offers of similar or substitute a. Real estate broker
properties and related market data, and b. Real estate appraiser
establishes a value estimate by processes c. Real estate consultant
involving comparison. d. Real estate developer
a. Market data approach 296. These are constraints that maybe
b. Cost approach imposed by clients or by statutory law
c. Income approach that would likely to affect valuation.
d. Contractor’s method
 a. Limiting Conditions c. Mean
b. Assumptions d. Range
c. Observations 305. This economic principle relates to the
d. Valuation methods principle of balance as well as to the
297. A person who possesses the necessary principle of contribution. This principle
qualifications, ability, and experience to holds that as capital units are added, a
execute/performed a valuation. certain point is reached where the added
a. Appraiser or valuer units do not contribute value commensurate
b. Consultant with their costs.
c. Broker a. Principle of substitution
d. Salesperson b. Principle of balance
298. Is a valuer or an appraiser who is in the c. Principle of contribution
employ of either the entity that owns the d. Principle of increasing and decreasing
assets or the accounting firm responsible for returns
preparing the entity’s financial record and/or 306. The right of government to acquire private
reports. property for public use is referred to as
a. External Valuer a. eminent domain.
b. Public Sector Appraiser b. police power.
c. Internal Valuer c. escheat.
d. Valuer General d. taxation.
299. Is a valuer or an appraiser, together with any 307. Tax Imposed on profit presumed have been
associates, has no material links with the realized on the sale or disposition of lands
client, an agent acting on behalf of the client and/or buildings.
or the subject of the assignment. a. Estate tax
a. External Valuer b. Capital gains tax
b. Internal Valuer c. Inheritance tax
c. Assessor d. Realty tax
d. Broker 308. The following statements are true when
300. As provided for in the Philippine Valuation applied to Valuation Standards except
Standards, the four property types are: a. STANDARDS ARE STATEMENTS OF
a. Real estate, asset, machinery, plant and RECOGNIZED PRINCIPLES AND
equipment CONCEPTS
b. Real property, personal property, b. STANDARDS ARE STATEMENT OF
businesses and financial interests BEST PRACTICE IN PROCUREMENT
c. Real estate, fixture, chattel and trade AND REPORTING
related c. STANDARDS ARE STATEMENTS OF
d. Real property, machinery, equipment and ACCEPTED DEFINITIONS
plant d. STANDARDS PRESCRIBE SPECIFIC
301. Interests in property resulting from the legal METHODS OF VALUATION FOR
division of ownership interests in businesses DIFFERENT PURPOSES
and real property, from the contractual grant 309. The value of property to a particular
of an optional right to buy or sell property at a investor, or a class of investors, for
stated price within a specified period, or from identified investment or operational
the creation or investment instruments objectives.
secured by pooled real estate assets. a. Investment Value
a. Business b. Value in use
b. Financial interests c. Going concern value
c. Personal property d. Market value
d. Real estate investment trust 310. An amount above the Market Value that
302. The process of acquiring private property for reflects particular attributes of an asset that
public use is called are only of value to a particular
a. Eminent domain purchaser.
b. Police power a. Plottage value
c. Escheat b. SPECIAL VALUE
d. Condemnation c. Investment value
303. A type of business involving a combination of d. Value in use
two or more entities that join to undertake a 311. An additional element of value created by
specific project. the combination of two or more interests
a. Syndication where the value of the combined interest
b. Limited partnership is worth more than the sum of the original
c. Joint venture interests.
d. General partnership a. SYNERGISTIC VALUE.
304. In statistics, this term refers to the b. Market value
difference between the highest and the c. Investment value
lowest scores. d. Going concern value
a. Standard deviation 312. The International Financial Reporting
b. Mode Standards adopt these two models for the
 recognition of property assets in the balance receives a non-permanent right to use the
sheet: property in return for rental payments or
a. Cost model and value in use model other valuable economic consideration.
b. COST MODEL AND FAIR VALUE a. Lease interests
MODEL b. Fee simple
c. Cost model and investment value model c. Freehold
d. Cost model and going concern value d. Condominium
model 321. In business valuation, this approach may
313. Assets owned and/or controlled by be similar to the cost approach used by
governmental or quasi-governmental appraisers of different types of assets.
entities to provide goods or services to the a. Income approach
general public. b. Market data approach
a. PUBLIC SECTOR ASSETS c. Residual technique
b. Real estate d. ASSET-BASED APPROACH
c. Income generating assets 322. Specific materials that, by their presence or
d. Real property proximity, may have adverse effect on
314. This concept is based on the notion that property value because of their potential to
although two or more parcels of real estate cause harm to life-forms.
may have physical similarities and closely a. Fully depreciated buildings and
resemble one another, there may be improvements
significant differences in how they can be b. Hazardous and toxic substances
used. c. Non-fruit bearing trees
a. Utility d. Informal settlers
b. Value 323. The current cost of replacing an asset with
c. Highest and best use its modern equivalent asset less deductions
d. Substitution for physical deterioration and all relevant
315. The approach to value perceives value as forms of obsolescence and optimization.
created by the expectation of future benefits a. Replacement cost
(income streams). b. Reproduction cost
a. Market data approach c. Cost to cure
b. Income approach d. Quantity survey method
c. Cost approach 324. Refers to the loss in value of an asset
d. Allocation resulting from wear and tear over time,
316. This approach to value recognizes that including any lack of maintenance.
property prices are determined by the a. Functional obsolescence
market. Market Value can, therefore, be b. Economic obsolescence
calculated from a study of market prices for c. Deferred maintenance
properties that compete with one another for d. PHYSICAL DETERIORATION
market share. 325. Refers to loss in value that can be caused by
a. Market data approach advances in technology that result in new
b. Cost approach assets being capable of a more efficient
c. Capitalization process delivery of goods and services.
d. Income approach a. FUNCTIONAL OBSOLESCENCE
317. When data are available, this approach to b. Economic obsolescence
value is the most direct and systematic c. Deferred maintenance
approach to estimating value. d. Physical deterioration
a. Cost approach 326. A charge against a property in which the
b. Income approach property is security for payment of a debt
c. Market data approach is called a
d. Residual technique a. LIEN.
318. Describes a valuation where an entire b. mortgage.
business is transferred as an operational c. escheat.
entity. d. restriction.
a. Going concern value 327. The Enchanted Kingdom theme park in
b. Value in use Sta. Rosa has had a significant impact
c. Market value on uses of land in its vicinity for many
d. Investment value years and an influence on the value of
319. This approach to value is also known as the that land. Which of the four forces does
contractor’s method, and is recognized in this represent?
most countries. a. Social
a. Market data approach b. Governmental
b. Asset based valuation c. ECONOMIC
c. Cost approach d. Environmental
d. Income approach 328. A financial modeling technique used in
320. A form of real property, arising from the the income approach to value that is
contractual relationship between one who based on explicit assumptions regarding
owns the property and one who typically
 the prospective income and expenses of a. Gross income taxation
a property or business. b. AD VALOREM TAXATION
a. Direct capitalization c. Capital gains taxation
b. Annuity method d. Estate taxation
c. Discounted cash flow analysis 337. In mass appraisal, this is the process of
d. Investment method analyzing sets of property and market
329. A type of review undertaken to ensure that a data to determine the specific parameters
valuation meets or exceeds the compliance operating upon a model.
requirements or guidelines of the specific a. Standard deviation
market and, at a minimum, conforms to b. Range
Generally Accepted Valuation Principles c. Mode
of the Philippine Valuation Standards. d. CALIBRATION
a. Field review 338. The practice of appraising multiple
b. Technical review properties as of a given date by a
c. Desk review systematic and uniform application of
d. ADMINISTRATIVE REVIEW appraisal methods and techniques that allow
330. The rights and privileges granted to the for statistical review and analysis of results.
owner of intangible assets. a. MASS APPRAISAL
a. Personal property b. Valuation process
b. Bundle of rights c. Multiple regression
c. INTANGIBLE PROPERTY d. Grid analysis
d. Tangible property 339. Represents the ownership interest of a
331. A valuation review that is limited to the data lessor owning real estate that is subject to
presented in the report, which may or may lease to others
not be independently confirmed. a. Leasehold fee estate
a. Field review b. Leased fee estate
b. Technical review c. Partial interest
c. DESK REVIEW d. Bundle of rights
d. Administrative review 340. Any form of lease rental arrangement in
332. This theory involves the concept that land which the lessor receives a form of rental
cannot be valued under one highest and best that is based on the earnings of the lessee.
use while the improvements are valued Percentage rent is an example.
based on another highest and best use. a. TURNOVER RENT
a. Consistent use b. Base rent
b. Contribution c. Market rent
c. Balance d. Economic rent
d. Anticipation 341. Rights generally inherent in the
333. Refers to a housing program and projects ownership of real estate include
covering houses and lots or homeless only are referred to as
undertaken by the government or the private a. Property rights
sector for the underprivileged and homeless b. Real property
citizens. c. Bundle of rights
a. Low cost housing d. Lease interests
b. Socialized housing 342. At the most fundamental level, value is
c. Subdivision development created and sustained by the
d. Bliss project interrelationship of five factors that are
334. A valuation review performed by an associated with any product, service, or
appraiser to form an opinion as to whether commodity. These factors are –
the analyses, opinions, and conclusions in a. Utility, need, purchasing power, buyers
the report under review are appropriate, and sellers
reasonable, and supportable. b. Capital markets, money markets,
a. Field review discount rate and reserve requirements
b. Technical review c. Utility, scarcity, desire, purchasing
c. Desk review power, and transferability
d. Administrative review d. Location, size, shape, terrain and
335. These are individual properties, such as elevation
hotels, fuel stations, and restaurants that 343. In property markets, this represents the
usually change hands in the marketplace quantity of property interests that are
while remaining operational. AVAILABLE FOR SALE OR LEASE at
a. Specialized properties various prices in a given market within a
b. Public sector assets given period of time, assuming labour and
c. Institutional properties production costs remain constant.
d. Trade related properties a. Demand
336. A revenue-raising procedure, based on the b. Purchasing power
assessed value of property related to a c. Desirability
scale of charges defined by statute within a
specified time-frame.
 d. SUPPLY income to the land over a sustained period of
344. In property markets, this constitutes the time.
number of possible buyers or renters a. Interim use
SEEKING SPECIFIC TYPES OF b. Actual use
PROPERTY interests at various prices in a c. Highest and best use
given market within a given period of time, d. Existing use
assuming other factors such as population, 352. An ______________ market is one that
income, future prices, and consumer is characterized by goods or services
preferences remain constant. that are easily produced and readily
a. DEMAND transferable, with a large number of
b. Supply buyers and sellers.
c. Active market a. Active
d. Efficient market b. Calm
345. This economic principle holds that value is c. Inefficient
simply a function of the present worth of d. EFFICIENT
future benefits. 353. This theory is based on the idea that the
a. Principle of substitution greater the volume of an item, the less each
b. Principle of contribution incremental volume should cost.
c. Principle of anticipation a. Cheaper by the dozen
d. Principle of highest and best use b. ECONOMIES OF SCALE
346. Public sector land valuation and taxation c. Anticipation
in the Philippines is the domain of two (2) d. Increasing returns
arms of the government, namely: 354. The surplus productivity principle recognizes
a. Department of Budget and Management the four agents of production, which are
and Local Government Units a. Land, buildings, other land improvements
b. Land Registration Authority and Bureau and machinery
of Internal Revenue b. Plant, machinery, equipment and
c. LOCAL GOVERNMENT UNITS AND technology
BUREAU OF INTERNAL REVENUE c. Land, labor, capital and
d. Local Government Units and National entrepreneurship
Tax Research Center d. Land, buildings, labor and capital
347. Related to the property itself, this principle 355. In any enterprise, labor must be paid first,
holds that value is achieved and maintained with capital paid after that,
when all elements are in proper proportion. entrepreneurship is then paid. The
a. Principle of conformity residual income is attributed to the land
b. Principle of balance (including buildings). This concept applies in
c. Principle of contribution what economic principle affecting values?
d. Principle of increasing and decreasing a. Economies of scale
returns b. Contribution
348. This economic principle holds that as time c. Balance
and market conditions change, so does d. SURPLUS PRODUCTIVITY
supply and demand for real estate, and thus, 356. This term means coordination or
the value of real estate. management.
a. Principle of change a. Capital
b. Principle of substitution b. Labor
c. Principle of anticipation c. ENTREPRENEURSHIP
d. Principle of progression or regression d. Production
349. This economic principle holds that a prudent 357. This comparative approach considers the
purchaser would pay no more for a home sales or offers of similar or substitute
than it would cost him or her to build or buy properties and related market data, and
another one. establishes a value estimate by processes
a. Principle of conformity involving comparison.
b. Principle of balance a. Market data approach
c. Principle of contribution b. Income approach
d. Principle of substitution c. Cost approach
350. A valuation review that includes inspection d. Development technique
of the exterior and sometimes the interior 358. The process of orchestrating land, labor,
of the subject property and possibly and capital to produce an item.
inspection of the comparable properties to a. Conduction
confirm the data provided in the report. b. Analysis
a. Technical review c. ENTREPRENEURSHIP
b. Desk review d. Capitalization
c. Administrative review 359. The forces that impact real estate values
d. Field review are the following:
351. It is defined as that logical, legal, and most a. Physical, economical, sociological and
probable use which will yield the greatest net physiological
 b. Population, income level, skill levels and b. Decline
social environ c. Stability
c. SOCIAL, ECONOMIC, PHYSICAL OR d. Growth
ENVIRONMENTAL AND 368. The act of distinguishing or delineating
GOVERNMENTAL markets that the appraiser should consider
d. Political, economical, governmental and in his data program is called
physical a. market segregation.
360. These forces relate to trends in society or b. market analysis.
culture, and sometimes these forces are c. market segmentation.
imagined while at other times they are based d. market study.
on actual facts and figures. 369. In this type of market, goods and services
a. Environmental are not readily produced or easily
b. Governmental transferable, with no readily identified group
c. Physical of buyers and sellers active in a particular
d. SOCIAL marketplace.
361. A / An ______________________ is a a. Efficient market
group of complementary land uses. b. INEFFICIENT MARKET
a. Zone c. Buyer’s market
b. Area d. Seller’s market
c. NEIGHBORHOOD 370. The study of a specific market. It is the
d. Municipality collection and dissection of data and the
conversion of that data to information that
362. In the application of this technique to can be used for analysis and decision-
estimate value, the building value is making by an appraiser or analyst.
estimated as the present value of the a. Marketability study
residual income attributable to the building b. Feasibility study
of an income producing property. c. MARKET ANALYSIS
a. BUILDING RESIDUAL TECHNIQUE d. Investment analysis
b. Land residual technique 371. A rate of return used to convert a
c. Property residual technique monetary sum, payable or receivable in
d. Development technique the future, into present value.
363. The term used to describe the connecting of Theoretically it should reflect the
complementary uses to the homogenous opportunity cost of capital, i.e., the rate of
land uses (zone) is return the capital can earn if put to other
a. LINKAGE. uses having similar risk.
b. road network. a. Internal rate of return
c. Passage. b. DISCOUNT RATE
d. right-of-way. c. Overall rate
364. Neighborhoods and zones alike generally d. Investment rate
exist in one of four life cycle stages; these 372. The three types of market analysis are:
are – a. MARKET STUDY, MARKETABILITY
a. growth, stability, renovation, and rebirth STUDY AND FEASIBILITY STUDY
b. growth, decline, reconstruction, and b. Market data approach, sales comparison
revitalization approach and offers
c. GROWTH, STABILITY, DECLINE, AND c. Investment analysis, economic base
REVITALIZATION. analysis, monetary analysis
d. growth, stability, decline and rebuilding d. Statistical study, market study and
365. These are assets that embody a cultural, demographics study
historic, and/ or architectural heritage. 373. The analysis of an environment of
a. Agricultural properties buyers/sellers and/or landlords/tenants
b. HISTORIC PROPERTIES (lessors/lessees).
c. Trade related properties a. Marketability study
d. Public sector assets b. Feasibility study
366. The initial stage in a neighborhood or zone’s c. MARKET STUDY
life cycle. This refers to the period in which d. Investment analysis
the neighborhood or zone is expanding 374. Type of market analysis that addresses
and developing. the time required to absorb a particular
a. Revitalization product, and the price or rent level at
b. Decline which that product would be accepted
c. Stability into the marketplace.
d. GROWTH a. Marketability study
367. When a neighborhood can no longer b. Feasibility study
compete with other comparable c. Market study
neighborhoods, it usually enters the d. Investment analysis
_________________ stage of its life cycle. 375. A ____________ study is simply a
a. Revitalization comparison of cost versus the value if the
project is undertaken.
 a. Marketability study a. Comparable data
b. Feasibility study b. Elements of comparison
c. Market study c. UNITS OF COMPARISON
d. Investment analysis d. Physical characteristics
376. A study undertaken for the purposes of 384. The cost to create a virtual replica of the
development and investment, the evaluation existing structure, employing the same
of investment performance, or the analysis of design and similar building materials.
a transaction involving investment a. Replacement cost, new
properties. b. Unit-cost-in-place method
a. Economic base study c. Quantity survey method
b. Market study d. Reproduction cost, new
c. Feasibility study 385. The current cost of a similar new item
d. INVESTMENT ANALYSIS having the nearest equivalent utility as
377. A mortgage secured by a group of properties the item being appraised.
or a number of lots. a. Replacement cost, new
a. Blanket mortgage b. Unit-cost-in-place method
b. Simple mortgage c. Quantity survey method
c. Lein 386. An asset which has a similar function and
d. Mechanic’s lien equivalent productive capacity to the
378. If the contract rent and the market rent asset being valued, but of a current
are equal, the Leasehold or Lessee’s design and constructed or made using
Interest is _______________, assuming current materials and techniques.
there is no leasehold improvement. a. Replacement asset
a. Positive lease b. Reproduced asset
b. Negative lease c. MODERN EQUIVALENT ASSET
c. ZERO d. Public sector asset
d. Balanced 387. The process of adjusting the replacement
379. This comparative approach to value involves cost to reflect that an asset may be
the cost of acquiring equivalent land and technically obsolete or over-engineered, or
constructing an equivalent new structure. the asset may have a greater capacity
a. Market data approach than that required.
b. COST APPROACH a. Reproduction cost, new
c. Income approach b. Capitalization
d. Builder’s method c. Value engineering
380. In operating lease, the value of the d. OPTIMIZATION
Lessee’s Interest is estimated as the 388. A real estate mall developer purchases a
present value site with the intent of building a regional
a. of rental payment for remaining life of the mall because the immediate area has a
lease agreement significant number of households and
b. OF RENTAL GAIN OR LOSS AND THE the income level of those households is
VALUE OF THE LEASEHOLD affluent. What type of force is the
IMPROVEMENT, IF ANY neighborhood going through?
c. of rental payment plus reversion value of a. SOCIAL
the property at the end of the lease b. Governmental
agreement c. Economic
d. of rental gain or loss plus reversion value d. Environmental
of the leasehold improvement, if any 389. Specific characteristics of properties
381. A _____________________ leasehold and transactions that cause the prices
interest is created when the contract rent is paid for real estate to vary.
higher than the current market rent. a. Comparable data
a. Positive b. Units of comparison
b. Equal c. ELEMENTS OF COMPARISON
c. Zero d. Comparable sale prices
d. NEGATIVE 390. Method of estimating the reproduction cost
382. A group of homogenous land uses. or replacement cost that combines the direct
a. DISTRICT and indirect costs into a single unit-in-
b. Neighborhood place amount, which when multiplied by the
c. City unit measure of the improvement’s
d. Municipality component will yield the cost of the
383. Typically, a factor produced by two component.
components, which reflects precise a. Unit-in-place
differences between properties and b. Comparative
facilitates analysis in the three approaches to c. Quantity survey
value, e.g., price per square meter or d. Index or trending
square foot, or the ratio of a property’s sale 391. The cost of replacing an asset with an
price to its net income (net income equally satisfactory substitute asset; normally
multiplier/years’ purchase). derived from the current acquisition cost of a
 similar asset, new or used, or of an c. Comparative method
equivalent productive capacity or service d. Index or trending method
potential. 401. This cost estimate envisions constructing a
a. Replacement cost structure of comparable utility, employing the
b. Unit-cost-in place design and materials that are currently used
c. Reproduction cost in the market.
d. Builder’s method a. Reproduction cost
392. The Subic Freeport Zone is one of the b. Replacement cost
largest developments in Central Luzon. What c. Quantity survey method
force does this represent? d. Unit-in-place method
a. Social 402. The period of time over
b. Governmental which improvements
c. Economic contribute to property
d. Environmental value.
393. The process by which a least cost a. Useful life
replacement option is determined for the b. ECONOMIC LIFE
remaining service potential of an asset. c. Remaining life
a. Reproduction cost, new d. Lifespan
b. Capitalization 403. Lose in value caused by a flaw in the
c. Value engineering structure, materials, or design that
d. OPTIMIZATION diminishes the function, utility, and value of
394. Method of estimating the reproduction the improvement
cost or replacement cost that involves the a. Functional obsolescence
adjustment of the original costs to current b. Economic obsolescence
costs by a multiplier derived from c. Physical deterioration
published cost indexes. d. Deferred maintenance
a. Unit-in-place 404. The period of time over which the
b. Comparative components of the improvement may
c. Quantity survey reasonably be expected to perform the
d. Index or trending functions for which they were designed.
395. Type of lease which involves the transfer a. Economic life
ownership from lessor to lessee. b. USEFUL LIFE
a. Operating lease c. Remaining life
b. FINANCING LEASE d. Used life
c. Leased fee 405. The age indicated by the condition and
d. Leasehold fee utility of a structure
396. Lose in property value are caused by a. Used life
deterioration or obsolescence b. Chronological life
a. DEPRECIATION c. EFFECTIVE AGE
b. Deferred maintenance d. Actual age
c. Cost to cure 406. A method of estimating depreciation that
d. Replacement cost involves the development of a
397. The difference between the cost to depreciation estimate by studying sales
reproduce or replace a property and its of comparable properties that have
present value depreciated to a similar degree as the
a. Replacement cost improvement.
b. Cost to cure a. Cost to cure method
c. DEPRECIATION b. Component method
d. Regression c. Market extraction method
398. Major causes of depreciation are the d. Observed condition method
following except 407. A method of estimating depreciation
a. Deferred maintenance whereby the appraiser estimates the total
b. Physical deterioration economic life expectancy of the existing
c. Functional obsolescence structure as well as its effective age,
d. External obsolescence based on an analysis of sales of similar
399. Refers to the wear and tear from regular use structures
and the impact of the elements a. Age-life method
a. Physical deterioration b. Component method
b. Functional obsolescence c. Market extraction method
c. External obsolescence d. Observed condition method
d. Adverse market condition 408. The estimated period from the actual age of
400. Method of estimating reproduction or a component to the end of its total useful life
replacement costs by applying the average expectancy.
or typical comparative cost (per square- a. Remaining economic life
meter cost) of similar improvements. b. REMAINING USEFUL LIFE
a. Quantity survey method c. Actual age
b. Unit-in-place method d. Effective age
409. An impairment of the utility or salability of an 418. The Philippines’ fiscal policy is managed
improvement or property due to negative by the
influences outside the property. a. Bangko Sentral ng Pilipinas
a. Functional obsolescence b. Department of Finance
b. Physical deterioration c. Department of Budget and Management
c. Adverse market condition d. Department of Justice
d. Economic obsolescence 419. The estimated amount for which a property,
410. Sometimes CALLED HISTORICAL AGE OR or space within a property, should lease on
CHRONOLOGICAL AGE, is the number of the date of valuation between a willing lessor
years that have elapsed since building and a willing lessee on appropriate lease
construction was completed. terms in an arm’s length transaction, after
a. Effective age proper marketing wherein the parties had
b. ACTUAL AGE each acted knowledgeably, prudently, and
c. Remaining useful life without compulsion
d. Remaining economic life a. Contract rent
411. A method of estimating the reproduction cost b. Market rent
or replacement cost that involves a c. Rental rate
complete cost itemization of all direct and d. Leased fee
indirect cost to be incurred or incurred in the 420. Financial vehicles with traditional
construction of an improvement. maturities or investment periods of
a. Index method less than one year.
b. Cost-in-place method a. Capital markets
c. QUANTITY SURVEY METHOD b. Cash deposits
d. Comparative method c. Time deposits
412. Primarily used to allocate a known amount of d. MONEY MARKETS
total depreciation, estimated by either the 421. In the income approach to value,
market extraction method or the age-life reconstructed operating statements specify
method, into its components that the income projection is subject to the
a. Component method assumption that the property is run by a / an
b. Market extraction method a. expert competent management.
c. Age-life method b. AVERAGE COMPETENT
d. BREAKDOWN METHOD MANAGEMENT.
413. The process of retiring a mortgage or c. inefficient operator.
debt over a specified time period. d. substandard management.
a. Debt service 422. Financial vehicles with usual maturities of
b. Installment more than one year.
c. AMORTIZATION a. CAPITAL MARKETS
d. Equity b. Cash deposits
414. Represents the money earned for the c. Time deposits
right to use capital. d. Money markets
a. Equity 423. In this technique the land value is estimated
b. Amortization as the present value of the residual income
c. Interest attributable to the land of an income
d. Principal amount producing property.
415. Also known as debt service. a. Building residual technique
a. Amortization b. Development technique
b. Equity c. LAND RESIDUAL TECHNIQUE
c. Installment d. Discounted cash flow analysis
d. PAYMENT 424. A loan for personal property and secured by
416. Credit regulation devices that the Bangko personal property.
Sentral ng Pilipinas can use to regulate a. Real estate mortgage
the supply of money. b. Chattel mortgage
a. Lending rates and amortization rates c. Liens
b. Capitalization rates and mode of d. Blanket mortgages
payments 425. __________ specify that the income
c. DISCOUNT RATES AND RESERVE projection is subject to the assumption that
REQUIREMENTS the property is run by a reasonably efficient
d. Production of new bills and disposal of operator or average competent
old bills management.
417. The government’s management of a. Operating statements supplied by client
revenues (taxes) and expenses b. Operating statements supplied by agent
(appropriations) is called of client
a. monetary policy c. OPERATING STATEMENTS
b. FISCAL POLICY RECONSTRUCTED BY THE
c. repayment policy APPRAISER
d. credit policy d. Operating statements reconstructed by
the internal auditor
426. The process of converting an income stream reversion value, anticipated at the end of
into value. the projection period.
a. CAPITALIZATION c. The series of dividends and the value of
b. Investment analysis the business at the end of the projection
c. Market analysis period.
d. Depreciation d. The series of periodic net operating
427. The resulting amount of reducing the incomes.
annual potential gross income by a 434. This capitalization process considers the
vacancy allowance amount. time value of money, and is applied to a
a. Gross profit series of net operating incomes for a
b. Net operating income period of years.
c. Effective net income a. Direct capitalization
d. Effective gross income b. YIELD CAPITALIZATION
428. Operating expenses are deducted from c. Discounted rate
the effective gross income to determine d. Internal rate of return
the 435. The estimated period over which existing
a. ANNUAL NET OPERATING INCOME improvements are expected to continue to
FOR THE PROPERTY. contribute to property value
b. annual net profit for the property. a. Remaining useful life
c. annual gross profit for the property. b. Effective age
d. annual depreciation of the property. c. Actual age
429. Process of converting income into value d. Remaining economic life
by dividing a single year’s stabilized net 436. A method that is used to build a
operating income, by an all-risks rate. capitalization rate using just two
a. Yield capitalization components; financing and equity.
b. Discounted cash flow analysis a. Build-up method
c. DIRECT CAPITALIZATION b. All risks method
d. Valuation approach c. Band of investment method
430. In the application of the discounted d. Gross income multiplier method
cash flow analysis to operating real 437. Defines the percentage number used to
properties, the value of the property is determine the current value of a property
estimated as the net present value of based on estimated future operating
a. The series of periodic net operating income.
incomes. a. Absorption rate
b. The reversion value, anticipated at the b. Selling rate
end of the projection period. c. Buying rate
c. THE SERIES OF PERIODIC NET d. Capitalization rate
OPERATING INCOMES, ALONG WITH 438. Acquisition of private land by the government
AN ESTIMATE OF THE REVERSION for public use could be undertaken thru the
VALUE, ANTICIPATED AT THE END following procedures, except
OF THE PROJECTION PERIOD. a. Negotiated sale or purchase
d. The value of the business at the end of b. Expropriation
the projection period. c. Exchange or barter
431. Profit-making entities operating to d. Foreclosure
provide consumers with products 439. A _________________ leasehold interest
or services. is created when the market rent is greater
a. Financial interests than the contract rent.
b. Real property a. Negative
c. Public sector asset b. Equal
d. BUSINESSES c. Zero
432. A credit regulation device of the BSP that d. Positive
refers to the percentage of deposits that 440. The rate that equates the present value of
must be retained by banks. the net cash flows of a project with the
a. Discounted rates present value of the capital investment.
b. Fiscal policy a. DISCOUNTING RATE
c. Credit regulation b. Overall rate
d. RESERVE REQUIREMENT c. Internal rate of return
433. In the application of the discounted cash flow d. Recapture rate
analysis to development properties, the 441. This rate reflects both the return on the
value of the properties is estimated as the invested capital and the return of the
present value of the original investment, which are basic
a. THE SERIES OF NET CASH FLOWS considerations of potential investors.
THAT ARE DISCOUNTED OVER THE a. Discounting rate
PROJECTED DEVELOPMENT AND b. Overall rate
MARKETING PERIODS. c. INTERNAL RATE OF RETURN
b. The series of periodic net operating d. Recapture rate
incomes, along with an estimate of the
442. The rent specified by a given lease
arrangement. Dividend Rate or COC = BTFC/EQUITY =
a. Economic rent 1.44M/12.5M = 11.52%
b. Market rent
c. Contract rent 449. For the office building above and the same
d. Rental rate information, what is the over-all rate of return
443. The following are standard tests for highest for the property?
and best of real property, except a. 8.58%
a. PHYSICALLY POSSIBLE b. 12.00%
b. POLITICALLY PERMISSIBLE c. 7.50%
c. FINANCIALLY FEASIBLE d. 9.90%
d. MAXIMALLY PRODUCTIVE
444. Applicable to real estate improvements, the Solution
rate warranted by prudent investors that will Over All Rate Of Return
represent the return on investment (usually RO = NOI/SP = 5.94M/60M = 9.9%
the interest rate or capitalization rate) and
the return of investment, for improvements, 450. If the land value in a subdivision has
this is represented by the recapture rate. increased by 12% during the past year
a. Discounting rate and the average price of land sold last
b. OVERALL RATE year was P 1,560,000, what is the
c. Internal rate of return average price of land sold today?
d. Recapture rate a. P 1,372,800
445. Interest Rate + Recapture Rate equals b. P 1,716,000
a. Discounting rate c. P 1,572,500
b. OVERALL RATE d. P 1,747,200
c. Internal rate of return
d. Return on investment Averagae Selling Price = 1.56M×1.12 =
446. This government or public restriction to 1,747,200
ownership provides that if a person dies
without a will and heirs, that person is said to 451. A commercial property producing an annual
have died intestate, and that person’s gross income of P768,500 was sold two
property transfers to the state. months ago for P5,620,000. What is the
a. Eminent domain property’s gross income multiplier?
b. Police power a. 7.50
c. Escheat b. 7.40
d. Expropriation c. 7.21
447. If a property’s net income ratio is 0.80, d. 7.31
what is its operating expense ratio? 8.50 GIM = Sales Price/Gross Income =
a. 0.02 5.62M/768,500 = 7.31
b. 2.0
c. 0.80 452. What is the value of a property with a
d. 0.20 building value of P2,400,000, a land
capitalization rate of 8.0%, building overall
An office building was recently sold for rate of 14% and net operating income of
P60,000,000. Given the following P545,000?
information: a. P 4,012,000
Gross potential income : P12,000,000 b. P 6,812,500
Vacancy factor : 10% c. P 4,921,000
Expenses : 45% of effective d. P 5,012,500
gross income
Annual mortgage payment : P4,500,000 Solution
Equity : P12,500,000 Given:
448. What is the equity dividend rate or cash-on- Building Value 2.4M
cash rate of return? Land Cap Rate 8%
a. 7.48% Building Rate 14%
b. 12.00% NOI 545,000
c. 11.52%
d. 7.50% Income Due to Building = BV×BR =
2.4M×14% = 336K
Solution Income Due to Land = NOI – Income Due to
GPI 12M Building = 545K – 336K = 209K
Less: Vacancy 10% 1.2M Land Value = Income Due to Land/Land Rate
EGI 10.8M = 209K/8% = 2,612,500
Less: Exp.45% 4.86M Total Value = Building Value + Land Value =
NOI 5.94M 2.4M+2,612,500 = 5,012,500
Less: Debt Service 4.5M
BTCF 1.44M
453. To adjust the sale price of a comparable sale 457. A building has a rental income of P 60,600
with a 10% better location, you should per month. Using an annual gross rent
a. Add 10% to the sale price of the multiplier of 15, the value of the building
comparable would be estimated at –
b. Multiply the sale price of comparable by a. P 909,000
10% b. P 10,800,000
c. Subtract 10% from the price of the c. P 727,200
subject of appraisal d. P 10,908,000
d. Subtract 10% from the sale price of the
comparable 60,600×12×15 = 10,908,000
454. Subject of appraisal is a 4-bedroom house.
Based on the following paired data gathered, 458. The value of a property consisting of land
what would be estimated value of the subject and building with an annual net operating
of appraisal? income of P330,000 and with an over-all
Market data: capitalization rate of 12.50% is –
3-bedroom house was recently sold for P a. P 2,640,000
6,455,000 b. P 2,750,000
2-bedroom house was recently sold for P c. P 2,400,000
6,250,000 d. P 2,570,000
a. P 6,455,000
b. P 6,600,000 330K/12.5% = 2,640,000
c. P 6,660,000
d. P 6,665,000 459. Which of the following estimates would result
in a capitalization rate of 8% -
Solution a. Property value of P 2,500,000, potential
Value of 2BR : 6,250,000 gross income of P 200,000
Value of 3BR : 6,455,000 b. Property value of P 2,500,000, effective
Value of 4BR : 6,455,000 + (6,455,000 – gross income of P 200,000
6,250,00) = 6,660,000 c. Property value of P 2,500,000, net
operating income of P 200,000
455. A residential house was constructed in 2001 d. Property value of P 4,000,000, net
for P 12,568,000. The cost index published operating income of P 320,800
at that time was 178.20. The current cost 460. The property subject of appraisal is 15%
index from the same cost reporting service is superior than the subject of a comparable
360.70. What is the current indicated sale. The comparable was sold for
reproduction cost of the residential house? P2,212,000, what is the indicated value of
a. P 25,439,000 the subject?
b. P 25,349,000 a. P 1,880,200
c. P 25,136,000 b. P 1,923,500
d. P 25,316,000 c. P 2,602,400
d. P 2,543,800 (2,212,000 × 1.15)
Solution 461. An office building has depreciated by 50%
Given: since it was built 25 years ago. If it would
House Built 2001 : 12,568,000 cost P 39,200,000 to build today, and if
Cost Index 2001 : 178.20 similar sites are for P 25,000,000, what is the
Current Index : 360.70 estimated market value of the property
today?
RCN = 12,568,000 × (360.70/178.20) = a. P 64,200,000
25,439,268.24 b. P 48,520,000
c. P 44,600,000
456. What is the indicated value of a 6-year-old d. P 54,600,000
building with a floor area of 360 square
meters, if the current cost of construction of Assume the following:
similar buildings is P15,000 per square meter Annual net operating income of the property :
of the floor area, and the estimated P 1,100,000
depreciation of the building is 2% per year? Land value : P 4,500,000
a. P 4,572,000 Interest rate : 8%
b. P 4,752,000 Recapture rate : 4%
c. P 5,400,000 462. What is the property value by the building
d. P 5,752,000 residual technique?
a. P 10,666,667
Solution b. P 11,666,667
RCN = 360 × 15K = 5.4M c. P 9,666,667
Less Depreciation (2% × 6 × RCN) = 648K d. P 12,666,667
VALUE = 5.4M – 648K = 4,752,000
Solution
Income Due to Land
 = LV×BR
= 4.5M×8% Solution
= 360K RCN = 80M
Less: Accrued Depreciation = 10/50 (RCN) =
Income Due to Building 16m
= NOI – Income Due to Land Building Value 80M – 16M = 64M
= 1.1M – 360K
= 740K 467. A 10-year-old building is currently valued at
P7,200,000. What was its original value if it
Building Value has appreciated by 60% since it was built?
= Income Due to Building/(Land Rate + a. P 4,320,000
Recapture Rate) b. P 2,880,000
= 740K/12% c. P 4,500,000
= 6,166,666.67 d. P 5,142,900
468. The appropriate adjustment for time is
Total Property Value determined to be 8% per year. The time
= Building Value + Land Value adjustment for a comparable property that
= 4.5M + 6,166,666.67 was sold a year ago for P10,000 per square
= 10,666,666.67 meter is
a. Less P 800 per square meter
463. Mr. B owns a parcel of land leased to Mr. C b. Plus, P 1,000 per square meter
at an annual rental rate of P1,000,000. The c. Plus, P 800 per square meter (10K ×
lease has a remaining life of 6 years. What is 8%)
the present value of the rentals if the interest d. Less P 1,000 per square meter
rate is 10% per year? Present worth factor 469. A lessee is renting a commercial space with
for annuity is 4.35526 and lump sum is a base rent of P7,000 per month plus 5% of
0.56447. the gross sales exceeding P100,000 per
a. P 4,355,260 month. The lessee’s gross sales last year
b. P 3,386,820 was P1,600,000. How much rent was paid
c. P 1,771,573 last year?
d. P 1,771,561 a. P 184,000
b. P 104,000
Solution c. P 84,000
Present Value = 1M × Annuity Factor d. P 114,000
4.35526 = 4,355,260
Solution
464. A building was constructed 10 years ago and Annual Rent = 7K × 12 = 84K
is well-maintained that based on the
observation of the appraiser its condition is Gross Sales = 1.6M
similar to other 6-year-old buildings. The Less: Threshold = 100K × 12 = 1.2M
effective age of the building is 1.6M – 1.2M = 400K
a. 10 years
b. 4 years Overage Rent = 400K×5% = 20K
c. 6 years Total Rent = Annual + Overage Rent = 84K +
d. 16 years 20K = 104,000
465. A building was constructed 10 years ago
and is well-maintained that based on the 470. A 30-year mortgage covering 75% of
observation of the appraiser its condition is property value can be obtained from a bank
similar to other 6-year-old buildings. The for 8.5%. The mortgage constant is 0.092.
actual age of the building is Equity for this type of property requires 12%
a. 10 years return.
b. 4 years a. 9.00%
c. 6 years b. 9.90%
d. 16 years c. 10.00%
466. The reproduction cost new of a commercial d. 10.50%
building is estimated to be P80,000,000. The
building should have an economic life of 50 Solution
years, and it is now five years old. However, RO = (.75 × .092) + (.25 + .12) = 0.069 +
based on the observation of the appraiser its 0.03 = .099 or 9.90%
effective age is similar to other 10-year-old
building due to poor maintenance. What is its 471. What would be recapture rate of a
value of the building (exclusive of land building having a remaining economic
value)? life of 12 years –
a. P 72,000,000 a. 112%
b. P 64,000,000 b. 88%
c. P 80,000,000 c. 8.33% (1/12) (100)
d. P 75,000,000 d. 8.00%
472. In a property residual capitalization c. 18 ¾ %
approach, what is the value of an improved d. 18 ¼ %
property with a net income of P180,000 a
year, an interest rate of 8% and a recapture Solution
rate of 2%? HL Value = 8.8M
a. P1,800,000 (180K/(8% + 2%) Land Value = 1.65K
b. P 2,250,000 Value of Land Percentage =
c. P 3,000,000 1,650,000/8.8M = 18.75% or 18 3/4
d. P 1,500,000
473. A house and lot is priced at P7,500,000. The 478. A property with an annual net income of
lot alone is valued at P2,531,250. What is P336,000 was sold for P4,200,000. The
the percentage of the total asking price is remaining life of the building is 40 years.
attributed to the house? Land value is P1,200,000. What is the
a. 33 ¾ % overall rate for the property?
b. 33 ¼ % a. 6.00%
c. 66 ¼ % b. 7.00%
d. 66 ¾ % c. 8.00%
d. 9.00%
Solution
HL – 7.5M Solution
Less Land – 2,531,250 Over all Rate = 336K/4.2M (100) = 8%
House Value = 4,968,750/7.5M = 66.25%
479. A comparable land was sold a year ago for
474. A vacant lot is rented for a car display for P30,000 per square meter. Its location is
P24,000 per month. The interest rate considered 15% inferior and its shape and
applicable to this type of property is 8%. topography is 10% superior to the subject
Compute the value of the property by income site. The time adjustment is 3% per year.
approach. Determine the adjusted sale price of the
a. P2,400,000 comparable site.
b. P2,600,000 a. P 29,400 per square meter
c. P2,800,000 b. P 32,400 per square meter
d. P3,600,000 c. P 30,600 per square meter
d. P 38,400 per square meter
Solution
Annual Rent = 24K × 12 = 288K Solution
Value = I/R = 288K/8% = 3.6M 30K × 1 + (15% - 10% + 3%) = 32,400

475. If a particular buyer requires a recapture of 480. A property with an annual net operating
the building portion of the price in 30 years, income of P336,000 was sold for
what is the indicated recapture rate of the P4,200,000. The remaining life of the
building? building is 40 years. Land value is
a. 3% P1,200,000. What is the value of the
b. 3 ½% building?
c. 3 1/3% (1/30) a. P 3,000,000 (4,200 – 1200)
d. 3 ¼% b. P 2,000,000
476. Mr. A is leasing a 60-square meter c. P 2,500,000
commercial space for P3,000 per square d. P 3,500,000
meter per year. Research indicate that 481. A property was sold for P60,000,000. Using
similar space has a going market rate of the rule-of-thumb of building-to-land ratio of
P3,200 per square meter per year. What is 4:2, what is the value of the building?
the rental gain realized by Mr. A per year? a. P 20,000,000
a. P 1,200 b. P 30,000,000
b. P 12,000 c. P 40,000,000 (60M × 4/6)
c. P 2,400 d. P 50,000,000
d. P 24,000 482. A 10-year old residential apartment has a
reproduction cost of P6,250,000, broken
Solution down into P 2,500,000 representing the
Market Rent – 3,200 structural component, and P 3,750,000 for
Contract Rent – 3,000 the other component. Yearly allowance for
Gain = 3.2K – 3K = 200 × 12 = 12,000 ordinary structural deterioration is 2%, while
the depreciation rate for the curable
477. A house and lot is priced at P8,800,000. The component is 5% per year. Economic
lot alone is valued at P1,650,000. What obsolescence result in a rental loss of
percentage of the total asking price is P60,000 per year. What is the estimated
attributable to the value of the lot? value of the building?
a. 18.5 % a. P 5,150,000
b. 19.0 % b. P 3,875,000
 c. P 3,275,000 880K : Sold yesterday
d. P 3,775,000
880K/800K = 1.10 or 10% in value in 1 year
Solution 1M × 1.05 = 1,050,000 adjusted sales price
RCN : 6,250,000
Structural Component : 2,500 486. If a property has a net income ratio of 0.75
Other Component : 3,750,000 and a gross income multiplier of 9, what is
Deterioration : 2% per year the indicated over-all capitalization rate?
Depreciation : 5% per year a. 6.75%
Economic Obsolescence rental loss : 60K b. 8.33%
per year c. 2.78%
d. 12.00%
RCN Structural Component = 2.5M – (2% ×
10 × RCN) = 2.5M – 500K = 2M Solution
RCN Other Component = 3.75M – ( 5% × 10 GIM : 9
× RCN) = 3.75M – 1.875M = 1.875M NIR : .75
Total RCN = 2M + 1.875M = 3.875M
Gross Rent Multiplier = Sales Price /
483. A comparable property sold six months ago Gross Income = .75/9 = 8.33%
for P1,250,000. Market investigation
indicates the following 487. Corporation T is to lease a parcel of land for
Location adjustment : +5% 1 year at P2,000,000. Research indicate that
Time adjustment : +6% similar land has a market rent of P2,200,000
Age adjustment : -7% per year. What is the estimated value of the
Given the above information, what is the leasehold interest if the rental payment is to
indicated value based on the comparable be paid as a lump sum amount today and the
property? interest rate is 10%?
a. P1,232,250 a. P 200,000
b. P1,300,000 b. P 220,000
c. P1,325,000 c. P 180,000
d. P1,293,860 d. P 181,818

Solution Solution
1,25M – (5% + 6% - 7%) = 1.3M Contract Rent : 2M
Market Renr : 2.2M
484. What is the reversion value of a property with Value : ?
an estimated market value of P12,540,000 2 PV = V(1+i)n
years from now at an interest rate of 10% per V = 200,000/1.1
year? V = 181.818
a. P 15,048,000
b. P 15,173,400 488. A commercial structure is a rectangle with
c. P 10,363,635 sides of 80 meters and 145 meters and the
d. P 10,157,400 current local cost to build a similar structure
is P18,500 per square meter. What is the
PV = FV/ (1+i)2 = 12.54M/1+.1)2 = 12.54M / estimated construction cost of the structure?
1.21 = 10,363,636.36 a. P 214,600,000
b. P 208,800,000
485. A comparable property is identical to the c. P 218,600,000
subject property being appraised. The d. P 215,600,000
comparable was sold six months ago for
P1,000,000. As the appraiser, you must Questions nos. 47 to 49 are based on the
make an adjustment for the time difference following information:
between the subject property and the Building Value : P50,000,000
comparable. You have found a paired sale of Net Operating Income : P8,350,000
two houses, one of which was sold one year Building Capitalization Rate : 14%
ago for P800,000, and the other sold Land Capitalization Rate : 9%
yesterday for P880,000. What is the proper 489. What is the residual income to the land?
estimated adjusted sales price for your a. P 1,350,000
comparable? b. P 4,500,000
a. P880,000 c. P 3,850,000
b. P1,000,000 d. P 70,000,00
c. P1,050,000
d. P1,100,000 Solution
Income of Building = Building Value ×
Solution Building Rate
1M : Sold 6 Months = 50M × 14% = 7M
800K : Sold 1 yr. ago Income Land = NOI – Income of Building
 = 8.35M – 7M = 1.35M b. The highest and best use as improved
would always be consistent with the "as
490. What is the value of the land? vacant" analysis
a. P 4,500,000 c. The improvement value must be
b. P15,000,000 adjusted down if the land’s highest
c. P 9,642,850 and best use is different than the
d. P 42,777,750 improved highest and best use
d. The vacant land value can never exceed
Solution the improved value
Value of Land = Land Income / Land Cap 497. When a property’s highest and best use is
Rate likely to change in the near future, the
= 1.35M/.09 = 15M prevailing highest and best use is called
a(n)
491. What is the total value of the property? a. Pending use
a. P 54,500,000 b. Temporary use
b. P 65,000,000 c. Interim use
c. P 59,642,850 d. Alternative use
d. P 92,777,750 498. A legally nonconforming use is
a. A use that was legally established and
Total Property Value = Land Value + Building maintained but no longer conforms to
Value existing zoning
= 15M+50M = 65M b. A use that was illegally established and
492. A buyer invests in a small strip center maintained
because she believes the property will net c. A use that was not legally established
P350,000 per year. This is an example of and maintained and still does not conform
a. Anticipation to existing zoning
b. Change d. A use that was not legally established
c. Competition and maintained but the government is not
d. Substitution enforcing the laws
493. The statement “property values are created 499. The purpose of regulating the real estate
and sustained when the characteristics of a service practitioners practice in the
property conform to the demand of its Philippines is to
market" refers to a. Protect the public from dishonest realty
a. Use value practitioners.
b. Contribution b. Protect realty practitioners from unfair
c. Conformity competition.
d. Supply and demand analysis c. Upgrade the standards of realty service
494. To be considered the highest and best use, a practice.
use must be d. All of the above.
a. Physically possible, legally 500. Market area life cycles include
permissible, appropriately justified, a. Growth, stability, decline, and
financially feasible, and maximally revitalization
productive b. Growth, stability, decline, and
b. Physically correct and legally possible gentrification
c. In existence already and legal c. Growth, stability, appreciation, and
d. Physically possible and appropriate decline
495. Highest and best use analysis requires an d. Growth, level of appreciation, and decline
estimate of the use as though vacant and 501. Neighborhood social
as improved to influences include all of the
a. ESTIMATE THE VALUE OF THE following except
IMPROVEMENTS a. Population density
b. ENSURE THAT APPRAISERS
RECOGNIZE THAT THE PROPERLY b. Occupant age levels
COULD BE WORTH MORE WITHOUT c. Occupant skill levels
THE BUILDINGS THAN WITH THEM d. Vacancy rates
c. ESTIMATE FUNCTIONAL 502. The economic base is
OBSOLESCENCE CAUSED BY a. The lower line in a graph showing the
INAPPROPRIATE IMPROVEMENTS economy of a community
d. ALL OF THE ABOVE b. The ratio of basic industries to technical
496. The concept of consistent use requires an Industries in a community
improvement to be valued based on a use c. An inexpensive, large string instrument
that is consistent with the site’s highest and d. The economic activity that enables it
best use. This means to attract income from outside its
a. The highest and best use of the site as borders
though vacant must always consider the 503. Economic
improvements thereon influences include
 all of the following d. Principle of Supply and Demand
except e. Principle of Competition
a. Occupant 511. The value of a property will reach to its
income levels maximum level when the factors of
b. Crime levels production such as: land, labor, capital,
c. Property rent levels coordination or entrepreneurship are in
d. Birth rate balance refers to
504. Governmental influences include all of the a. Principle of Balance
following except b. Principle of Substitution
a. Tax burdens c. Principle of Conformity
b. Zoning, building, and housing codes d. Principle of Anticipation
c. Special assessments e. HABU
d. Changes in property use 512. The principle of increase and decreasing
505. Gentrification is returns applied to a portion or the whole of
a. A class of citizens who live in blighted an improvement refers to
areas a. Principle of Anticipation
b. A process in which older homes in a b. Principle of Contribution
neighborhood are remodeled and c. Principle of Conformity
different residents replace the lower- d. Principle of Substitution
income residents e. HABU
c. A group of complementary land uses 513. The net income remaining after the cost of
d. A part of the life cycle of a market area in labor, capital and coordination have been
which property values are stable and the paid refers to
maintenance levels are adequate a. HABU
506. Linkages are b. Principle of Substitution
a. The devices used to change a property c. Principle of Anticipation
from one use to another d. Principle of Surplus Productivity
b. The relationships between a buyer and e. Principle of Conformity
seller in a real estate deal 514. The result of reasonable degree of
c. Time-distance relationships between a architectural homogeneity and compatible
property use and the supporting land uses brought about by market attitudes,
facilities societal trends, economic conditions and
d. The tools necessary to market real estate public policy refers to
507. What form of diffusion is represented a. HABU
by the spread of Shoe Mart (SM)? b. Principle of Substitution
a. cascade. c. Principle of Conformity
b. relocation. d. Principle of Anticipation
c. reverse hierarchical e. Principle of Utility
d. stimulus. 515. The meeting desires and requirements of
508. A real estate market is human beings. It is not only the capacity to
a. A shopping center office of a realty give satisfaction in use but also the power to
company excite desire for continued possession refers
b. A group of individuals or firms to
that are in contact with one a. HABU
another for the purpose of b. Principle of Substitution
conducting real estate c. Principle of
transactions Conformity
c. A list of potential buyers for the d. Principle of
subject Anticipation
d. A list of potential sellers who have e. Principle of
property similar to the one requested by Utility
the buyer 516. The factor where the value is increased if
509. What will be the best tool for locating the supply is reduced by effective demand,
next Jollibee fast food restaurant in a city? resulting in scarcity refers to
a. GPS (Global Positioning System). a. Principle of Anticipation
b. GIS (Geographic Information System).
c. Microsoft Words. b. HABU
d. Remote Sensing. c. Principle of Supply and Demand
510. The industry
competition which d. Principle of Consistent Use
arises from profits e. Principle of Contribution
refers to 517. That factor where the property is cannot be
a. Principle of Change valued on the basis of one use for land and
another use of improvements refers to
b. Principle of a. Principle of Consistent Use
Substitution b. HABU
c. Principle of Conformity c. Principle of Anticipation
 d. Principle of Substitution b. SUBDIVISION DEVELOPMENT
e. Principle of Contribution METHOD; GROUND RENT
518. Refers to the most profitable and likely use CAPITALIZATION; LAND RESIDUAL
of the property at the time of appraisal. It METHOD
refers to that which in all probability will yield c. BOTH A AND B
the maximum return at a given time. It is the d. none of the above
first necessary consideration in studying a
tract of land to estimate its value. 526. Depending on market practice,
a. Principle of Supply and Demand entrepreneurial profit can be estimated as
b. Principle of Contribution percentage of
c. Principle of Substitution a. DIRECT AND INDIRECT COSTS PLUS
d. Principle of Anticipation LAND VALUE
e. Principle of Highest and Best Use b. THE VALUE OF THE COMPLETED
519. Is the amount that maybe recovered when PROJECT
the property will be retired or disposed at a c. BOTH A AND B
future time. d. none of the above
a. Salvage Value 527. Barricade
b. Scrap Value around the
c. Market Value construction
d. Principle of Substitution site is a building
e. Principle of Anticipation a. DIRECT
520. Is the fair market value of the land in a COST
specific zone or area as established by the b. indirect cost
BIR. c. overhead expense
a. Salvage Value d. incidental expense
b. Scrap Value 528. The cost of improvements identical in
c. Market Value design and material to those of the subject
d. Zonal Value property is called the subject’s
e. Principle of Contribution a. reproduction cost
521. One which states that the maximum value of b. replacement cost
a property tends to be set by the cost of c. sales price
purchasing an equally desirable and valuable d. market value
replacement property, as the basic principle 529. The cost of improvements identical in utility
that underlies the Market Data Approach of to those of the subject property is called the
Sales Comparison, subject’s
a. Principle of Anticipation a. reproduction cost
b. Principle of Highest and Best Use b. replacement cost
c. Principle of Substitution c. sales price
d. Principle of Supply and Demand d. market value
e. Principle of Contribution 530. In using the cost approach to
522. To be considered comparable to the subject appraising, the estimated
property, a comparable must have been sold construction cost of improvements
a. in an arm’s-length transaction usually will be based on
b. with a conventional mortgage a. their original cost
c. without any form of secondary financing b. THE COST OF NEW IMPROVEMENTS
d. for all cash AT CURRENT PRICES
523. One method of compensating for sales that c. book value
involved different terms of financing is use d. the national cost average of all
of the components
a. financing readjustment grid 531. The index method of
b. loan-to-value ratio estimating construction
c. CASH EQUIVALENCY TECHNIQUE cost is based on
d. operating statement ratio a. THE ORIGINAL COST
524. Recent sales of comparable sites OF IMPROVEMENTS
competitive with the subject site b. the cost of new improvements at current
a. Are the most reliable guide to the prices
probable current market behavior and c. book value
reactions of informed buyers. d. the national cost average of all
b. Do not indicate any probable current components
market behavior and reaction of informed
buyers. 532. The predominant depreciation category
c. Both a and b. for a residential location on heavily traveled
d. None of the above. national highway is
525. Site valuation techniques include a. Physical deterioration—curable
a. SALES COMPARISON METHOD; b. Physical deterioration—long-lived
ALLOCATION METHOD; incurable
ABSTRACTION METHOD c. Functional obsolescence—curable
 d. External obsolescence—incurable b. net operating income, found by
533. The predominant depreciation category deducting normal annual operating and
for severe termite damage throughout a other expenses from the effective gross
structure income; the capitalization rate for the
a. Physical deterioration—curable property; that is, the rate that can be
b. Physical deterioration—long-lived applied to the property’s net annual
incurable income, the result being the appraiser’s
c. Functional obsolescence—curable estimate of the property’s value;
d. External obsolescence—incurable c. both a and b
534. The ratio of total operating d. none of the above
expenses to effective gross 541. While working on an appraisal of a
income is the residential property in a new home
a. OPERATING EXPENSE subdivision, the appraiser finds that the
RATIO builders have a total of 100 home sites
b. net income ratio currently offered for sale. In measuring
c. effective gross income ratio market demand the appraiser notes that all
d. break-even ratio of the builders are currently averaging 2
535. The ratio of net operating new sales contracts per month (combined),
income to effective gross and are expecting to sell 24 homes within
income is the the next year. What conclusion could be
a. operating expense ratio drawn with regard to the 100 available home
b. NET INCOME RATIO sites and a market period of the next 12
c. effective gross income ratio months?
d. break-even ratio a. The market is in a condition of supply
536. The ratio of the operating expenses plus and demand.
annual debt service to potential gross income b. The market is in a condition of balance.
is the c. The market is in a condition of
a. operating expense ratio oversupply.
b. net income ratio d. The market is in a condition of
c. effective gross income ratio undersupply.
d. BREAK-EVEN RATIO 542. For land sales to be
537. To arrive at net operating used as
income, expenses are comparables, they
deducted from must be
a. operating profit a. COMPETITIVE
b. gross income WITH THE
c. Effective gross income SUBJECT
d. None of these b. RELATIVELY RECENT
538. In the formula for the operating expense ratio c. OPEN MARKET TRANSACTIONS
a. operating expenses are divided by d. ALL OF THE ABOVE
effective gross income 543. A bad floor
b. effective gross income is divided by plan would
operating expenses generally be
c. potential gross income is divided by classified as
effective gross income a. physical
d. effective gross income is divided by depreciati
potential gross income on
539. In the formula for the net income ratio b. economic obsolescence
a. effective gross income is divided by c. functional obsolescence
potential gross income d. economic deterioration
b. potential gross income is divided by 544. The valuation technique in which land
effective gross income and building are valued separately is
c. effective gross income is divided by net a. The income capitalization approach
operating income b. The sales comparison approach
d. net operating income is divided by c. Linear regression
effective gross income d. The cost approach
540. The data needed for an appraisal by the 545. Land valuation techniques include
income approach using direct capitalization a. Subdivision development, depreciated
are cost, consensus
a. the potential gross income from the b. Sales comparison approach, consensus,
property, which includes the annual extraction
income from all sources; the amount of c. Sales comparison approach,
the expected annual effective gross allocation, extraction
income from the property, estimated by d. Assessment multipliers, assessor’s
subtracting anticipated vacancy and opinions, multiple regression multipliers
collection losses from potential gross 546. Land value can be estimated using all
income; of the following techniques except
 a. The sales comparison method 556. The value added to total property value by
b. The cost method a particular component is an example of
c. The income method the principle of
d. The allocation method a. substitution
547. Which of the is NOT an agent of production? b. anticipation
a. land c. change
b. transportation d. contribution
c. labor e. conformity
d. capital 557. The concept that the value of a particular
e. entreprenuership components is measure by the amount that
548. Political forces affecting value may include its absence would detract from the value of
a. life-styles and living standards the whole is
b. topography a. opportunity cost
c. athletic levels and recreation facilities b. substitution
d. government spending and taxation c. competition
policy d. contribution
e. primary registration and turnout e. conformity
549. What are the two categories of tangible 558. The market loss cause by depreciation in an
property? older structure may be offset by all of the
a. real property and personal property following EXCEPT
b. intangible property and real property a. architectural interest
c. real estate and intangible property b. historical registration
d. legal and illegal investments c. strong demand relative to supply
e. open and shut transactions d. strong supply relative to demand
550. Zoning is an exercise of the e. renovation of the structure
a. equity courts 559. Studying appraisal helps a person
b. police powers a. to improve value estimation skills
c. Environmental Protection Agency b. to pass the real estate broker’s license
d. Right of condemnation examination
e. Right of escheat c. to understand other real estate courses
551. Is the amount paid by the lessee of a d. to communicate with appraisers
house or flat fee of a commercial bldg. e. all of the above
a. economic rent 560. Plant and Equipment are
b. rental a. TANGIBLE ASSETS, OTHER THAN
c. interest REALTY.
d. market price b. tangible assets, other than personality.
e. lease c. intangible assets, other than realty.
552. The revenue derived from the use of d. intangible assets, other than personality.
land and of the forces inherent to
land 561. Assets that are inextricably combined with
a. economic rent others and that may include specialised
b. rental buildings, machinery, and equipment.
c. interest a. PLANT
d. price b. Machinery
e. lease c. equipment
553. It is the price of any d. Business asset
commodity in its market at 562. Individual machines or a collection of
specified time machines. A machine used for a
a. economic rent specific process in connection with the
b. rental operation of the entity.
c. interest
a. Plant
d. market price
b. MACHINERY
e. lease
c. equipment
554. Functional utility depends on
d. Business asset
a. zoning
563. For assets in the public sector, the
b. age of equipment
c. wear and tear on the structure assumption equivalent to a business
d. insurance requirements continuing as a going concern is that the
e. tastes and standards public sector assets
555. Value in use is a. WILL CONTINUE TO BE USED FOR
a. subjective THE PROVISION OF THE
b. objective RELEVANT PUBLIC GOOD OR
c. readily measurable SERVICE.
d. a market phenomenon b. Will cease to be used for the provision
e. synonymous with market price of the relevant public good or service.
c. Both of the above.
d. None of the above.
564. Plant for the supply of electricity, gas, c. a good or service has no value in
heating, cooling or ventilation and equipment exchange unless it possesses certain
such as elevators economic and legal characteristics
a. Should be reflected in the value of the d. the price representing value is usually
real estate interest quoted in terms of money
b. Would not normally be reflected in the e. real estate may be sold for all cash or
value of the real estate interest financing arranged
c. Both of the above. 572. All of the following will affect the
d. None of the above. market value of a property
565. Intangible assets that can have an impact on EXCEPT
the value of plant and equipment include a. political factors
a. PRODUCTION RECORDS b. economic factors
b. PATENTS c. legal use restriction e. social concerns
c. OPERATING SOFTWARE d. acquisition cost to present owner
d. ALL OF THE ABOVE. 573. Capacity to satisfy wants, production by
566. The value of patterns labor and their exchangeability
and dies is often a. economic concept
inextricably linked to b. economic principle
a. ASSOCIATED c. economic value
INTELLECTUAL d. economic utility
PROPERTY RIGHTS e. economic forces
b. operating software 574. Amount may be recovered when the property
c. Both of the above. will be retired or disposed at a future time
d. None of the above. a. zonal value
567. The period over which b. salvage value
property may be c. market value
profitably used is d. Book value
a. Invested Capital 575. Fair market value of the land in a specific
b. Capital Structure zone or areas as established by the BIR
c. Going Concern a. scrap value
d. Economic Life b. book value
568. Valuations of plant and equipment can be c. zonal value
carried out using any of the following d. salvage value
approaches: e. market value
a. the sales comparison approach. 576. Impairment of the desirability and
b. the cost approach (depreciated usefulness of a real property brought by the
replacement cost) physical, economic, and other changes
c. the income capitalization approach a. depreciation
d. All of the above. b. externalities
569. Which of the following types of property is c. obsolescence
subject to ad valorem taxation? d. damages
a. property owned by a religious e. loss
organization and used for a 577. Loss in value of property because of external
religious purpose B. new industrial influence
plants that state and local a. external loss
governments have induced, with b. external obsolescence
tax exemption as an incentive, to c. economic obsolescence
locate within their jurisdictions d. functional obsolescence
b. commercial buildings leased in part by e. external forces
nonprofit foundations 578. Real estate investment using others people
c. state colleges and universities money
d. a state capitol a. loan
570. A person owning less than the entire bundle b. investment
of rights has c. leverage
a. escheat d. fullback
b. a fee simple title e. lending
c. a partial interest 579. Appraisal under the unified housing loan
d. personal property program shall be undertaken by
e. a fee tail a. NHA
571. All of the following statements are true b. HLURB
EXCEPT c. HDMF
a. real property is a type of service d. HIGC
b. value is dependent on market conditions e. HUDCC
580. Loss in value of property because of the b. Principle of progression
buyers desire or because of the presence of c. Principle of highest and best use
fixtures which are not desirable d. None of the above
a. external loss e. Principle of increasing and diminishing
b. external obsolescence return
c. economic obsolescence 589. The increase in value of real estate without
d. functional obsolescence any effort or expense of the owner is:
e. external forces a. Unearned increment
581. The selling price of real estate is usually b. Accretion
based on its: c. Unearned income
a. Market Value d. Accession
b. Exchange Value e. Adhesion
c. Speculative Value 590. The study of current supply and demand
d. None of the above conditions in a particular area for particular
e. Intrinsic Value type of property is:
582. The average selling price of homes in a a. Market analysis
district can best be determined by: b. Absorption method
a. Comparative Analysis c. Real Estate appraisal
b. Any of the above d. Income projection
c. Assessed Value e. Cash flow analysis
d. None of the above 591. A loss in value from any cause is a common
e. An appraisal definition of:
583. Conjugal partnership can be dissolved by: a. Depreciation
a. Legal separation b. Economic obsolescence
b. Judicial separation of property c. Functional obsolescence
c. Annulment of marriage d. Effective age
d. Any of the above e. None of the above
e. None of the above 592. The process of making installment payments
584. Income approach in appraisal would be most consisting of principal and interest that
widely used: reduces the loan balance:
a. On commercial and investment a. Amortization
properties b. Liquidation
b. On properties heavily insured c. b. Acceleration
c. On newly opened subdivision d. Hypothecation
d. None of the above e. None of the above
e. On properties heavily mortgage 593. The income approach to value is an
585. The best evidence of ownership is application of the principle of:
a. Tax declaration a. Anticipation
b. Vicinity map b. Substitution
c. Torrens title c. Progression
d. None of the above d. Highest and Best Use
e. Technical description e. None of the above
586. The application of more factors of 594. The following are determinants of
production will tend to increase net value in appraisal of realty
income up to certain point beyond which except:
the introduction of more factors of a. Transferability
production will tend to decrease net b. Scarcity
income c. Demand
a. principle of conformity d. Utility
b. principle of substitution e. Purchasing Power
c. principle of progression 595. In the computation of depreciation of
d. principle of increasing and properties, the method widely used by the
diminishing return practitioner is the:
e. principle of regression a. Straight line method
587. The displacement of present resident by b. Declining balance method
people of lower economic status c. Diminishing return method
a. progression d. None of the above
b. substitution e. Cost benefits method
c. gentrification 596. An appraisal principle which holds that the
d. INFILTRATION value of property tends to be enhanced by
e. nuclei association with superior properties is:
588. The principle of value which states that value a. Principle of Progression
of a property tends to be enhanced when b. Principle of Attrition
there is reasonable homogeneity in use: c. Principle of Regression
a. Principle of conformity d. None of the above
 e. Principle of Infiltration d. city engineer
597. The rate of real estate tax in municipalities 606. Documentary stamp tax on the sale of
within metro manila is not more than property must be paid
a. 5% a. within 30 days from the date of
b. 10% notarization
c. 2% b. within 5 days after the close of the
d. 20% month of the date of sale
598. Under the local government code, c. within 10 days after the close of the
agricultural lands of more than one hectare month of the date of sale
are subject to additional tax of no more than d. at the time payment of capital gains tax
5% of assessed value when at lest 607. Value placed on taxable property by the
a. entire area is uncultivated assessor for ad valorem tax purpose
b. 50% of the area is uncultivated a. economic value
c. 30% of the area is uncultivated b. assessed value
d. 20% of the area is uncultivated c. appraised value
599. Annual levy on real estate equivalent to 1% d. market value
of the assessed value which shall be in 608. The property sold is an ordinary asset, what
addition to the basic real estate tax is the applicable tax
a. ad valorem tax a. estate tax
b. special education fund tax b. capital gains tax
c. excise tax c. percentage tax
d. vat d. creditable withholding tax
600. Capital gains on the sale of real estate 609. Tax fixed on documents, instruments and
classified as capital asset is papers evidencing acceptance, assignment
a. prepaid income tax or sale of a right, property or obligation
b. expanded withholding tax a. community tax
c. creditable tax on sale b. excise tax
d. creditable tax on sale c. estate tax
601. BIR revenue regulation no 17-2003, the d. documentary stamp tax
seller of a family home who failed to utilized 610. Banks acquired assets which form part of its
the proceeds to acquire a new residence real estate inventories at the close of its
within 18 months from the sale shall be accounting period shall be classified
assessed additional deficiency capital gains a. ordinary asset
tax inclusive of penalties and b. fixed asset
a. 5% p.a. c. capital asset
b. 20% p.a. d. tangible asset
c. 25% p.a. 611. Sale of a dealer of a residential dwelling is
d. 10% p.a. not subject to VAT when the price does not
602. Ground floor of a condominium project per exceed (2021)
BIR 28-29 shall be considered as a. 1,500,000.00
commercial and a additional rate shall be b. 1,000,000.00
added on established residential zonal value c. 2,500,000.00
of d. 3,199,200.00
a. 20% 612. Which of the following cannot be issued
b. 15% condominium certificates of titles
c. 10% a. subdivision lots
d. 25% b. two level row house
603. The estate tax return shall be filed with the c. one level raw house
BIR within d. industrial warehouse
a. 90 days from the death of the decedent 613. The required number of votes of registered
b. 120 days from the death of the decedent owners to authorize a condominium
c. 60 days from the death of the decedent corporation to sell or otherwise dispose of
d. 180 days from the death of the the common areas in a condominium project
decedent is
604. Taxpayer has__ to redeem his real property a. unanimous votes
which was levied and subsequently forfeited b. Simple majority votes
and acquired by the local government for tax c. 2/3 votes
delinquency d. 1/3 votes
a. 3 years 614. A space to be considered a condominium
b. 1 year unit
c. 5 years a. at least 5 storey high
d. 2 years b. manage by condominium corporation
605. The following composed the board of
assessment of Makati city, except
a. city assessor
b. register of deed
c. city treasurer
 c. be susceptible to independent use and c. One percent of assessed value
owner ship d. None of the above
d. unencumbered by any restriction e. Two percent of assessed value
615. The right of an owner lessor to receive the 622. Based on net gifts,
contract rent and reversion of property at the the maximum rate
end of the lease is of donor’s tax is:
a. fee simple a. Ten Percent
b. lease fee estate b. Fifteen percent
c. net lease c. Thirty percent
d. freehold d. Twenty percent
616. An authority given by the developer to a e. Twenty-five percent
broker to look for a supplier of backfilling 623. The value placed on taxable property by the
materials who shall be paid with developed assessor for ad valorem tax purpose is:
lots is: a. Market Value
a. Procurement agency b. Appraised Value
b. Sales agency c. Assessment Value
c. General Brokerage d. Assessed Value
d. None of the above e. Economic Value
e. Exchange agency 624. The estate tax return shall be filed with the
617. An agreement between an owner and a BIR within :
broker to sell a real estate property: a. 60 days from death of decedent
a. Listing b. 180 days from death of decedent
b. Power of Attorney c. 90 days from death of decedent
c. Authority to sell d. 240 days from death of decedent
d. None of the Above e. 120 days from death of decedent
e. Joint venture 625. Under the Local Government Code, the next
618. In the real estate period for the property owner to file a sworn
business, another declaration of ownership and value with the
term for the owner is: assessor is:
a. Customer a. Year 2018
b. Principal b. Year 2019
c. None of the above c. None of the above
d. Prospect d. Year 2020
e. Alter Ego e. Year 2021
619. The documentary stamp on lease of real 626. The documentary stamp tax
estate is P6.00 for the first P2,000.00 or on the sale of property must
fraction thereof and additional (2021) be paid
a. P0.50 for every P1,000 in excess of the a. Within thirty (30) days
first P2,000 from the date of
b. P1.00 for every P1,000 in excess of the notarization
first P2,000 b. Within five (5) days after the close of
c. P1.50 for every P1,000 in excess of the the month of the date of sale
first P2,000 c. Within ten (10) days after the close of the
d. P2.00 for every P1,000 in excess of the month of the date of sale
first P2,000 d. At the time of payment of capital gains tax
e. P3.00 for every P1,000 in excess of the e. At any time
first P2,000 627. The ground floor of a condominium project,
620. Under BIR Revenue Regulation No. 17- per BIR 28-98, shall be considered as
2003, the seller of a family home who failed commercial and an additional rate shall be
to utilize the proceeds to acquire a new added on established residential zonal value
residence within 18 months from the sale of:
shall be assessed additional deficiency a. 10%
capital gains tax inclusive of penalties and: b. 25%
a. 5% interest per annum c. 15%
b. 10% interest per annum d. 30%
c. 15% interest per annum e. 20%
d. 20% interest per annum 628. The schedule of fair market value in
e. 25% interest per annum municipalities in Metro Manila is prepared by:
621. The rate of real estate tax in municipalities a. MMDA
within Metro Manila is not more than b. Bureau of Internal Revenue
a. One-half percent of assessed value c. Concerned Municipal Assessor
b. Three percent of assessed value d. Sangguniang Bayan by ordinance
e. None of the above
629. The amount of family home equivalent to the
fair market value considered as allowable
deductions from the estate of the decedent
a. P 500,000.00
 b. P 1,000,000.00
c. P1,500,000.00
d. P 2,000,000.00
e. P 750,000.00
630. A taxpayer has ____ to redeem his real
property which was levied and
subsequently forfeited and acquired by
the local government for tax delinquency.
a. 1 year
b. 60 days
c. 2 years
d. 4 years
e. 3 years
631. In case of foreclosure sale where right of
redemption is not exercised by the
mortgagor, who pays the capital gains tax?
a. Owner-mortgagor
b. Buyer of the property
c. None of the above
d. Creditor-bank
e. Any of the above
632. The documentary stamp on every
mortgage or pledge of real estate is:
(2021)
a. P40.00 for the 1st P5,000.00 plus
P20.00 for every P5,000.00 thereafter
b. P10.00 for every P5,000.00 or fraction
thereof
c. P15.00 for every P5,000.00 or fraction
thereof
d. P2.00 on each P200.00 or fraction thereof
None of the above
633. Market value is ____ the same as selling b. should describe the community
price. objectively
a. always c. is a study by the estate’s industrial
b. usually development commission
c. never d. considers the negative aspects only
d. none of the above e. considers the positive aspects only
e. sometimes 642. In analyzing the economic environment and
634. Price is market area, it is best to
a. market value a. start at the general level and work
b. a historical fact down to the specific
c. most probable sales price b. start at the specific and work up to the
d. all of the above general level
e. investment value c. limit the analysis to the national level
635. Functional utility depends on d. generally consider traffic flow
a. zoning 643. Which of the following reports is usually NOT
b. wear and tear on the structure prepared by a real estate appraiser?
c. tastes and standards a. marketability study
d. age of the equipment b. economic study
e. insurance requirements c. feasibility study
636. Value in use is d. transportation network study
a. subjective e. valuation study
b. objective 644. An appraisal of a specific-purpose for
c. readily measurable insurance purpose would depend most
d. a market phenomenon heavily on
e. synonymous with market price a. book value
637. The value added to total property value by a b. highest and best use
particular component is an example of the c. cost estimate
principle of d. specialty value
a. substitution e. land value
b. contribution 645. The first step in the appraisal process is to
c. anticipation a. define the problem to be solved
d. conformity b. gather relevant data
e. change c. analyze the data
638. The concept that the value of a particular d. inspect the property
components is measure by the amount that e. set the fee to be charged
its absence would detract from the value of 646. An appraisal is
the whole is a. an estimate of net
a. opportunity cost realizable value
b. contribution b. always concerned
c. substitution with the market value
d. conformity c. an appraiser’s
e. competition opinion of market
639. The market loss cause by depreciation in value
an older structure may be offset by all of d. a precise statement of value
the following EXCEPT e. a broker’s comparative sales analysis
a. architectural interest with further detail
b. historical registration 647. The “as of” date in an appraisal report is
c. strong demand relative to supply a. the date to which the value applies
d. strong supply relative to demand b. immaterial to the value estimate
e. renovation of the structure c. the date on which the report is delivered
a. S d. the date on which the property will be
b. to pass the real estate broker’s license conveyed
examination e. the anticipated closing date
c. to understand other real estate courses 648. Sales data descriptions of an appraisal
d. to communicate with appraisers report contain
e. all of the above a. details about each comparable sale
640. A dramatic change in short-term demand for b. an analysis of the date, using the value
real estate in the local market is likely to approaches
immediately precipitate c. the investigation of market forces
a. construction d. analysis of the street each comparable
b. activity property is on
c. price changes e. zoning details
d. no change in supply 649. All of the following are ways to delineate a
e. conversions neighborhood EXCEPT
641. The area and community analysis section of a. natural barriers
an appraisal report b. streets
a. should “sell” the community c. UTILITY SERVICE
 d. income characteristics b. a value certification
e. political boundaries c. an appraisal log
650. All of the following are sources of d. a narrative
comparable sales EXCEPT e. an appraisal report
a. public records 658. The form of an appraisal report
b. mortgage services a. has no influence on the appraisal
c. brokers process
d. appraisers b. is the same, regardless of the problem
e. buyers and sellers c. is set by the amount of the fee
651. Which of the following criteria most d. is determined by the appraiser
completely define “highest and best use”? e. determines the appraisal framework
a. legally authorized, politically viable, 659. The effective age and the useful life of a
and socially acceptable building represent judgments made by the
b. physically possible, comparable to other a. appraiser
uses in the neighborhood, and legally b. buyer
authorized c. property owner
c. physically possible, legally d. insurer
permissible, financially feasible, and e. tax assessor
generating a higher present land value 660. The period over which existing improvements
than any other use are expected to continue to contribute to
d. comparable to other uses in the property value is their
neighborhood, physically possible, and a. effective age
generating a higher present land value b. period of diminishing returns
than any other use c. remaining economic life
e. the tallest and most beautiful structure d. chronological age
that can be placed on land e. remaining physical life
652. The three basic approaches used to estimate 661. For a building, effective age is best defined
value are as
a. use, exclusion, and disposition a. the average age of the roof
b. cost, sales comparison, and use b. the actual age divided by the age-life
c. cost, sales comparison, and market data c. the age of other property in equivalent
d. cost, sales comparison, and production condition and utility the chronological
e. cost, sales comparison, and income age of the building
capitalization d. the chronological age of the building
653. Units of comparison are used in e. the period over which the building may be
a. only the sales comparison approach effectively used
b. only the cost approach 662. The utility of real estate is its
c. only the income capitalization approach a. attractiveness to the trained observer
d. A, B and C b. longevity
e. the appraisal of special-purpose c. capacity to satisfy human needs and
properties only desires
654. When reconciling the adjusted sales prices d. effective demand
of comparables, the greatest emphasis e. remaining economic life
should be given to 663. In appraising a residence, adjustments are
a. the average NOT made to the comparable property for
b. the median a. age
c. the mode b. terms of sale
d. the mean of A, B, and C c. lot value
e. none of the above d. size
655. Which of the following forms of appraisal e. ASSESSED VALUATION
report is NOT recommended? 664. When a site has improvements on it, the
a. completely filled-in institutional form highest and best use
b. telephone conversation a. is not definable
c. letter report b. is its existing use
d. long narrative report c. is its potential use
e. demonstration d. depends on whether or not the existing
656. Which of the following approaches would use is changeable
probably be given the most weight in e. MAY BE DIFFERENT FROM ITS
appraising a large office building? EXISTING USE
a. reproduction cost 665. To be considered as a comparable, a
b. income capitalization property
c. subdivision development a. a must have been sold within the past 5
d. market absorption years
e. replacement cost b. must be competitive with the subject
657. The form in which a formal appraisal is c. must have been sold by an open-market
presented is called transaction
a. a presentation of value d. must be a similar color
 e. both B and C b. capital recovery
666. The direct sales comparison approach is c. diminished utility
better than the income or cost approach d. sinking fund factor
because e. book depreciation
a. FEWER COMPARABLE PROPERTIES 674. The present and future demand for a
ARE REQUIRE, SO IT IS EASIER TO property and its absorption rate is considered
OUTLINE THE RESULTS TO CLIENTS in a
b. THERE ARE FEWER MATHEMATICAL a. letter in appraisal
CALCULATIONS, SO THERE IS LESS b. market feasibility study
CHANCE OF MATHEMATICAL ERRORS c. market segmentation
c. THE MARKET FOR REAL ESTATE IS d. highest and best used analysis
SLOW TO CHANGE e. transmittal letter
d. IT IS ALWAYS EASIER TO OBTAIN 675. The appraiser final estimate should be based
DATA FOR THE DIRECT SALES on
COMPARISON APPROACH a. average of three value indications
e. NONE OF THE ABOVE TRUE obtained by three approaches
667. The appraisal of an established 20-year old b. weighing of the reliability of the
motel on a road with numerous competitive information analyzed in each of the
motels would most likely be based on the three approaches
a. square foot are of improvements c. the most sophisticated guess technique
b. number of units d. adjustment for most recent indicators in
c. reproduction cost the local market
d. gross rent multiplier 676. the appropriate time adjustment is concluded
e. occupancy rate to be an increase of 7% per year
668. In applying gross rent multiplier analysis to compounded. The time adjustment for a
the subject property, the appraiser would use comparable sales property that should for
the 80,000.00 two years ago.
a. market rental a. 11,529
b. actual rent being paid b. 11,200
c. rent currently asked by the owner c. 9,200
d. rent offered by a potential tenant d. 91,592
rent listed in advertising the property e. 5,600
677. the criteria for determining the highest and
669. Reproduction or replacement cost includes best used include all of the following
all of the following EXCEPT EXCEPT
a. DIRECT OR HARD COSTS a. physical possibility
b. INDIRECT OR SOFT COSTS b. probable use
c. ENTREPRENEURIAL PROFIT c. financial feasibility
d. FIXED AND VARIABLE EXPENSES OF d. effect on community welfare
OPERATIONS e. legal permissibility
e. ELEVATOR SHAFTS 678. the broad forces affecting value do not
670. In analyzing obsolescence , the test of include
curability of a component in a building is a. physical
whether the cost to cure is no greater than b. social
the c. life cycle
a. EXPECTED INCREASE IN VALUE d. economic
b. reproduction cost new e. political
c. replacement cost 679. the certification of value section of an
d. installation cost appraisal report states everything EXCEPT
e. economic life of the new component that
671. Which of the following is NOT a type of a. the appraiser has no interest in the
depreciation? property
a. ENTREPRENEURIAL LOSS b. the fee is not contingent upon any aspect
b. functional obsolescence of the report
c. external obsolescence c. the facts are correct to the best of the
d. economic obsolescence appraiser knowledge
e. physical deterioration d. last year the property was appraised
672. Estimation of occurred depreciation and by the another person
obsolescence does NOT involve e. the property was personally inspected by
a. physical deterioration the appraiser
b. functional obsolescence 680. one implication of competition and excess
c. economic obsolescence profit is that
d. wear and tear a. there is a certain optimum combination of
e. financial structure land, labor, capital and entrepreneurship
673. In appraisal, accrued depreciation is really b. an estimate of value should be based on
an estimate of future expectation
a. physical deterioration
 c. abnormally high profits cannot be b. signature of the appraiser
expected to continue indefinitely c. identification of property appraised
d. maximum value accrues to real estate d. certification
when social and economic homogeneity e. all of the above
are present in a neighborhood 689. the highest and best used of land as if vacant
681. cost indexes offered by standardized forms part of the basis for
services are used to a. mortgage-equity analysis
a. derive units of comparison b. property rights adjustment
b. catalog building component c. an operating expense estimate
c. estimate operating expenses d. the cost approach
d. update past cost into current cost e. the square footage practice
e. estimate the local consumer price index 690. identifying and studying submarkets of a
682. a summary appraisal report larger market is called
a. contains many items that are not a. market research
considered in practice b. market survey
b. is an appraisal report prepared for a client c. market agglomeration
c. summarizes the item that might be d. market segmentation
used in practice e. market data
d. may be based on hypothetical or 691. the identification and study of a pertinent
assumed data market is called
e. should be prepared on a nontypical a. market analysis
property to appraisal practice b. neighborhood review
683. real estate in a submarket is c. property research
a. a group of sales person who deal mostly d. market reflection
in the same type of property e. market interaction
b. a group of sales that occur at the same 692. which of the following is important for good
time appraisal communication
c. a group of similar properties in the a. word choice
same area b. reading level
d. a small portion of the market of similar c. grammatical correctness
properties d. clarity
e. an area where sandwiches on French e. all of the above
bread are eaten 693. all of the following are true except
684. the fact that rents for equally desirable a. real property is a type of service
space tend to be set by the market reflects b. value is dependent on market condition
the principle of c. a good or service has no value in
a. balance exchange unless it possesses certain
b. substitution economic and legal characteristics
c. externalities d. the price representing value is usually
d. consistent used quoted in terms of money
e. conformity e. Real estate may be sold for all cash or
685. the fee for an appraisal assignment is financed
a. based on a percentage of the final value 694. in estimating the market value of comparable
estimate sale, an appraiser must consider all of the
b. agreed upon during the preliminary following EXCEPT
study stage a. whether the transaction was made in
c. determined after the appraisal is cash, terms equivalent to cash, or other
completed precisely revealed terms.
d. set by the fee schedule of the local board b. Whether the property had reasonable
of realtors exposure in a competitive market
e. set by a fee scale from real estate c. Whether a fair sale was transacted, with
commission neither the seller nor the buyer acting
686. the last step in the appraisal report is to under duress
a. write the report d. Whether the replacement cost of the
b. reconcile all data property corresponds to its market
c. analyze the data value
d. inspect the property e. Whether the seller was related to the
e. set the fee to be charge buyer
687. the form of which a formal appraisal is 695. in preparing the appraisal report,
presented is called your analysis concludes that one
a. a presentation of value of the approaches to value is not
b. an appraisal log applicable to this particular case.
c. an appraisal report You should
d. a value certification a. omit the approach all together
e. a narrative report b. base the approach on hypothetical data
688. a formal appraisal must include the c. state that the approach is not relevant
a. date of value estimate
 d. state that the approach is not 704. the purpose of a ____ is to
applicable, explain the reason for this analyzed a property potential for
contention success
e. find another approach so as to include a. feasibility study
three approaches b. marketability study
696. in the cost approach the site is valued as if it c. market segmentation study
were d. appraisal report
a. vacant and available for development e. need study
to its highest and best use 705. a use must be_____ to be considered as a
b. improved and suited for its intended use possible alternative for highest and best used
or development a. physically and legally possible and
c. developed and operating financially feasible
d. attractively landscape b. physically and legally possible
e. without nearby utilities c. Already in existence and legal
697. investment value is best describe as d. Physically possible and appropriate
a. market price e. Legal and profitable
b. market value 706. an appraiser
c. the cost of acquiring a competitive a. determines the price
substitute property with the same utility b. defends value
d. the present worth of anticipated future c. estimates price
benefits to a certain entity d. estimates value
e. value in exchange e. determines value
707. the objective of the appraisal should be
698. the length of a tract of land along a street is stated in the report
called a. the market needs it
a. depth b. it define the problems and identifies
b. width the value sought
c. frontage c. it identifies the function of the report
d. abutment d. it absolves the appraiser of liability
e. lineage e. there are too many definitions of market
699. the most comprehensive type of appraisal price
report is 708. the value estimate provided in an appraisal
a. form report a. changes with the use to which it is put
b. oral report b. changes with the function of the appraisal
c. letter report c. remains the same regardless of use
d. narrative demonstration report d. depends upon the use or function of the
e. unbiased report appraisal
700. the principle of ______states that buyer e. always reflects market value
will not pay more for the a site than for 709. population increases______demand for
another equally desirable one housing
a. anticipation a. depress the
b. imbalance b. are incapable of simulating the
c. substitution c. have no effect on the
d. balance d. are likely to create a
e. conformity e. are determined by the
701. the principle of anticipation is 710. environment hazards that an appraiser
a. future oriented must be conscious of include all of the
b. past oriented following except
c. the as of date of appraisal a. asbestos
d. anticipated loan to value ratio for the b. radon
subject property c. drano
e. similar to the principle of substitution d. urea formaldehyde
702. the principle of_______states that the value e. PVC
levels are sustained when the various 711. In analyzing the environment and market
elements in an economic or environmental area, it is best to
mix are in equilibrium a. start at the general level and work
a. anticipation down to the specific
b. equivalence b. start at the specific and work up to the
c. substitution general level
d. balance c. limit the analysis to the national level
e. highest and best used d. limit the analysis to the local level
703. price and value are e. generally consider the traffic flow
a. not necessarily the same 712. the first step in general process is to
b. synonymous a. define the problem
c. different, depending on financing terms b. gather data
d. almost the same in an active market c. analyze data
e. interchangeably in a report d. determine the approaches to value
 e. make a final value estimate c. should be discussed in appraisal
713. combining to or more sites in order to report
develop one site with a greater value than d. was not an arms length sale
the individual sites have separately called e. should be used as comparable sale,
a. synergy though adjusted for its time and terms
b. plottage 722. the dimensions of a
c. surplus land warehouse are customarily
d. excess land measured from
e. highest and best use of land a. a roof line
714. assemblage is b. the midpoint of exterior wall
a. always reflect in the market value c. the inside of finished wall
b. the act of bringing to or more smaller d. the outside of finished wall
lots into common ownership for use e. be reasonable or appropriate
c. inappropriate for parcels two or more 723. the construction of a luxury home in a
hectares neighborhood almost completely developed
d. uneconomical with one and two bedroom apartments
e. illegal would
715. typically, land is appraised by the a. produce external obsolescence
a. square foot b. be called an under improvement
b. front foot acre c. results in plottage value
c. all of the above d. results in neighborhood amenities
d. none of the above e. be reasonable or appropriate
716. it is_________for an appraiser to 724. the most detailed, complex, costly and time
receive or pay finders or referral consuming method of cost estimation is the
fees a. quantity survey
a. reasonable b. trade breakdown
b. unethical c. comparative unit
c. necessary d. unit in place
d. customary e. comparable unit
e. convenient 725. An improvements remaining economic life
717. a sale between relatives is considered a. it is chronological stage
a. an arms length transaction b. it is effective age
b. a purely comparable sale c. is the period over which the
c. an open market sale improvements are expected to
d. a distorted sale generate benefits
e. a good deal d. is effective age minus chronological age
718. What of the following is true about zoning e. effective age ;us chronological age
a. it reflects the expectation that government 726. the cost approach most applicable when the
will preserve property values property being appraise
b. it is based on the right of government a. has old improvement
to regulate for health, moral, welfare b. has relative new improvements that
and safety represent the highest and best use of
c. it is inappropriate for parcels withed uses the land
d. it represents an effort to establish the c. suffers substantial functional
land highest and best use obsolescence
e. it represent the right to reuse the property d. is more costly than the surroundings
719. for an appraiser to use the assistance of e. has many older features that make
another appraiser is interesting reading in a report
a. inconsiderate 727. price per front foot
b. unethical a. a physical unit of comparison
c. illegal b. not as accurate as price per acre
d. ethical c. rarely used in residential site analysis
e. questionable d. an accurate guide to site marketability
720. it is_________to provide a value range to a e. useful when there are few physical
client who request it and understand its differences between sites
meaning and use. 728. which is the last step in reconciliation
a. foolish a. identify which of the three approaches is
b. appropriate used
c. un ethical b. apply the three approaches to the data
d. approximate collected
e. difficult c. apply to judgment to the data collected
721. any recent sale of a subject property being d. review previous work and analysis
appraised e. select a final value of estimate
a. should be considered confidential 729. the highest and best use of the site is its
b. cannot, under any circumstances, be a. existing use
considered in estimating the current b. most probable use
market value of the property c. immediate next used
 d. synonymous with ordinary and necessary 738. Which of the following criteria most
value completely defines “highest and best use”?
e. different from most probable use a. physically possible, legally acceptable,
730. markets in residential real estate are and generating a higher present land
a. equivalent to those for securities value than any other use
b. related to physical boundaries b. legally authorized, politically viable, and
c. local socially acceptable
d. physically obscure c. physically possible, comparable to other
e. found by courthouse sales uses in the neighborhood, and legally
731. inflation tends to increase the value of authorized
a. fixed income securities d. comparable to other local uses, physically
b. mortgages possible, and generating a higher present
c. deeds in lieu of foreclosure land value that any other use
d. real estate e. the tallest and most beautiful structure
e. debts that can be placed on the land
732. Real estate markets 739. The total income anticipated from income
a. are international in scope property operations after vacancy and
b. meet none pf the criteria of a perfect collection allowances and operating
market expenses are deducted is
c. are centralized in nature a. net operating income
d. consist of used property only b. before-tax cash flow
e. are well developed in former Communist c. effective gross income
countries d. potential gross income
733. The subject property has 85% occupancy. e. property residual income
What conclusion would you most likely draw 740. Which principle of value best affirms that
if the typical occup0nacy rate in the area was value is the present worth of expected future
95%? benefits?
a. Advertising is average. a. supply and demand
b. The rents are high. b. balance
c. The rents are low. c. substitution
d. Management is good. d. anticipation
e. New construction will occur soon. e. conformity
734. The fact that the value of a property tends 741. Which principle of value best affirms that
to equal the cost of an equally desirable the maximum value of property generally
substitute is an example of the principle of cannot exceed the cost of its replacement?
a. balance a. increasing and decreasing returns
b. substitution b. supply and demand
c. contribution c. substitution
d. diminishing returns d. balance
e. supply and demand e. anticipation
735. Population flow to different regions of the 742. Which of the following would be classified
United States will change primarily because as a tangible rather than an intangible
of amenity?
a. changing economic opportunities a. pride of ownership
b. environmental control legislation b. a sense of security
c. rezoning legislation c. a free dishwasher
d. state tax policies d. work satisfaction
e. air conditioning in the Sunbelt e. clean air
736. When each alternative use requires the 743. Which type of property is subject to ad
same capital investment, the use that valorem taxation?
maximizes the investment’s______ on a a. property owned by a religious
long-term basis is the highest and best use. organization and used for religious
a. diversified portfolio purpose
b. operating expenses b. new industrial plants that state and local
c. net operating income governments have induced, with tax
d. potential gross income exemption as an incentive, to locate
e. occupancy rate within their jurisdictions
737. What would be the indicated value of a c. commercial property with more that
property that rented for 750 per month, 50% nonprofit tenants
using a monthly gross rent multiplier of d. state colleges and universities
100, if the expenses attribute to the e. a state capitol
property were 115 per month? 744. Compared with other assets, real estate is
a. 75,670 a. immobile
b. 75,000 b. expensive
c. 68,750 c. long-lived
d. 61,125 d. mortgagable
e. 13,750
 e. all of the above b. 150,000.00
745. All of the following are sources of c. 229,166.00
comparable sales EXCEPT d. 333,333.00
a. public records e. 400,000.00
b. brokers
c. buyers and sellers 6,000 – 1,250 × 12 /12%
d. mortgage servicers
e. appraisers 753. the land development method is used to
746. An allowance for vacancy and collection loss estimate the value of vacant acreage that is
is estimated as a percentage of ready to be subdivided. This method
a. net operating income requires
b. before-tax cash flow a. STUDY OF CURRENT SALES OF
c. effective gross income SUBDIVIDED LOTS
d. potential gross income b. THE PROJECTION OF LAND OF
e. after-tax cash flow SUBDIVIDED LOTS
747. The annual net operating income c. RTC approval
from an apartment house is d. Both A and B
11,000. If a capitalization rate of e. None of the above
11% is used, the indicated market 754. a technique in income capitalization in which
value is the analyst need not distinguish interest rates
a. 126,000 from capital recovery rates, but that is most
b. 176,000 useful for comparable income
c. 100,000 a. DIRECT CAPITALIZATION
d. 242,000 b. building residual
e. 2,420 c. land residual
748. which of the following is true of a gross lease d. bank of investment
a. the tenant pays all operating expense e. internal rate of return
b. the landlord pays all operating 755. cash on cash return is
expense a. the annual cash flow divided by the
c. this lease is used only for commercial equity investment
properties b. an internal rate of return that
d. rent rises with the cost of living represents annual income and all
e. this lease must be drafted by an attorney gains or losses prorated to an effective
749. a forecast using discounted cash flow annual amount
analysis would include c. a percentage or decimal rate that,
a. income, vacancy and operating expense when divided into a periodic income
b. an economic analysis amount, offers a lump-sum capital
c. reversion at the end of the holding period value for income
d. discounting expected future cash flows to d. a value that does not change with time
a present value e. none of the above
e. all of the above 756. Which report is usually NOT prepared by
750. in discounted cash flow analysis, the a real estate appraiser?
reversion to be received at the end of the a. marketability study
holding period is b. economic study
a. a separate cash flow c. feasibility study
b. an annuity in arrears d. MINERAL VALUATION STUDY
c. an ordinary annuity e. highest and best use
d. percentage of annual income 757. Questions 86-89 based on the information
e. amount to be capitalized in perpetuity below.
751. Income capitalization is the term used to You are appraising a 40-acre tract of
describe the process of estimating the unimproved by a real land. The size is zoned
value of income property by studying for single-family residential use. All utilities
expected future income. This process are available along the street on which the
a. converts the net income of a property land fronts. The engineers who will plat the
into its equivalent capital value proposed subdivision told you that 20% of
b. reflects the time value of money by the land area will be used for streets and
reducing or discounting future income into sidewalks. Zoning will permit four lots per
its present worth acre of net developable land after deducting
c. focuses on the present worth of future streets. Research indicates that lots similar
benefits to those that will be available on the subject
d. uses markets interest rates land will sell for 18,000 each and that the
e. all of the above entire tract can be developed and sold in 1
752. to earn 12% on your investment, what should year. You find that 40% of the sale price of
you pay for a property earns 6,000.00 per each lot must be allocated to selling cost,
month and has operating expenses of overhead, contingencies, carrying cost, and
1,250.00 per month developer’s profit, and that 2,000 feet of
a. 475,000.00 streets (including water, storm sewer, and
 sanitary sewer lines) must be installed at a c. 194,800
cost of 80 per foot. d. None of the above
e. Cannot be calculated from the information
What is the number of lots to be developed? given
a. 40 765. Questions 94-97 are based on the following
b. 128 information:
c. 80 A building contains 50 one-bedroom units
d. 88 and 150 two-bedroom units. The one
e. 32 bedroom units rent for 550 monthly; two
758. What is the gross amount that will be bedroom are 675. the vacancy rate is 7%;
realized from the sale of all the lots? operating expenses are estimated at 40% of
a. 720,000 effective gross income. There is 2,000.00
b. 2,304,000 annual income for vending machines.
c. 1,440,000
d. 1,584,000 potential gross income is
e. 576,000 a. 64,735
759. What is the cost of b. 1,547,000
installing streets, water, c. 1,545,000
and sewer lines? d. 717,425
a. 16,000 e. None of the above
b. 32,000 766. effective gross income is
c. 64,000 a. 64,735
d. 160,000 b. 1,547,000
e. None of the above c. 1,545,000
760. What is the amount of selling cost, d. 1,438,850
overhead, contingencies, carrying cost, e. None of the above
and developer’s profit? 767. Net operating income is
a. 921,6000 a. 64,375
b. 576,000 b. 268,970
c. 288,000 c. 863,310
d. 633,600 d. 719,425
e. None of the above e. None of the above
761. Questions 90-93 are based on the 768. operating expense are
information below: a. 1,545,000
A 100-unit apartment complex includes 40 b. 54,075
one-bedroom units that rent for 950 and 60 c. 2,000
two-bedroom units that rent for 1,150 d. 719,425
monthly. The vacancy rate is 5%; e. 575,540
miscellaneous income is 5,000 annually. 769. in one step of the land value residual
Operating expenses amount to 400,000. The technique, the building capitalization rate is
mortgage loan requires payments of 630,000 applied to the known building value to
annually. estimate the
a. highest and best use of the site
Potential gross income is b. cost of the building
a. 1,289,000 c. income needed to support the land
b. 112,000 d. net operating income needed to support
c. 107,000 the building
d. 1,284,000 11. Income property investments
e. Cannot be calculated from the information a. Low risk=low cap rate=high value
given b. Low risk=low cap rate=low value
762. Effective gross income is c. Low risk=low cap rate=low value
a. 1,224,800 d. Low risk=low cap rate=high value
b. 1,220,000 12. All other factors being equal, as the location
c. 824,800 of an income property becomes less
d. 107,000 desirable the cap rate used will be
e. Cannot be calculated from the information a. Lower
given b. Higher
763. Net operating income is c. Less reliable
a. 1,224,800 d. Unaffected
b. 184,800 13. Recapture generally applies to
c. 424,800 a. WASTING ASSETS, SUCH AS
d. None of the above BUILDINGS
e. Cannot be calculated from the information b. Non-wasting assets, such as land
given c. Both a and b
764. Before-tax cash flow is d. Neither a nor b
a. 1,030,000 14. In the land residual technique, the
b. 184,800 appraiser starts with an assumption of.
 a. Replacement cost d. Sandwich lease
b. Building value 26. Increase in maintenance costs are passed
c. Net capitalization on to tenants under a (n)
d. Land value a. Tax-stop clause
15. In the building residual technique, the b. Expense-stop clause
appraiser starts with an assumption of c. Gross lease
a. Replacement cost d. Escalator clause
b. Building value 27. The average of all variates is the
c. Net capitalization a. Mean
d. Land value b. Mode
16. The cash on cash rate is the same as the c. Median
a. Yield capitalization rate d. Range
b. EQUITY DIVIDED RATE 28. The center of all variates is the
c. Overall capitalization rate a. Mean
d. Break-even point b. Mode
17. Name the two component rates that are c. Median /Mid range
inherent in every capitalization rate d. Range
a. Investors rate 29. The different between the highest and lowest
b. Leased rate radiates is the
c. Interest and recapture rates a. Mean
d. Interest and depreciation rates b. Mode
18. Under which method are the recapture c. Median
installments lowest in the earlier year? d. Range
a. Annuity 30. The mean of five house sales prices of
b. Straight-line P100,000, P75,000,P175,000, P200,000,
c. Gross income multiplier method and P150,000 is
d. Band of investment method a. P140,000 (P700K/5)
19. Under which methods are the installment b. P150,000
highest? c. P700,000
a. Annuity d. P175,000
b. Straight-line 31. The median of the house sales price in
c. Gross income multiplier method question 20 is
d. Band of investment method a. P140,000
20. Which recapture method suggests the b. P150,000
greatest reduction in risk? c. P700,000
a. Annuity-line d. P175,000
b. Straight-line 32. The aggregate of the house sales prices
c. Gross investment method in question 20 is
d. Band of investment method a. P140,000
21. Schedule rent (or contract rent) that is b. P150,000
higher than market rent creates c. P700,000
a. Overage rent d. P175,000
b. Gross rent 33. What is the value in 5 years of an investment
c. Excess rent of P7,500 at 10% compounded daily.
d. Escalator rent a. P20,387
22. The amount paid over minimum base rent b. P12,365
in a percentage is c. P12,340
a. Overage rent d. P12,290
b. Gross rent 34. To determine the value in 8 years of an
c. Excess rent investment of P10,000 at 10% compounded
d. Escalator rent annually the applicable factors is
23. The lease under which the tenant pays a a. 2.143589 (1.108)
fixed rental and the landlord pays all b. 2.357948
expenses of ownership is the c. 1.948717
a. Gross rate lease d. 2.182875
b. Triple net lease 35. Calculate the monthly payment required to
c. Net lease amortize a loan of P270,000 at 9 ½ percent
d. Percentage lease interest for e term of 40 years.
24. An index will be referred to in a (n) a. P221.40
a. Gross lease b. P2,187.17
b. Triple net lease c. P2,403
c. Escalator clause d. P2,214
d. Expenses-stop clause Formula
25. The interest of a sublessee is a PMT = PV × Si/S – 1
a. Leasehold 36. The factor used to find the monthly payment
b. Lease fee required to amortize a loan of P147,000 at 11
c. Subleasehold percent interest over 30 years is
 a. .0092 The time adjustment is 12% per year.
b. .0096 Determine the adjustment sale price of the
c. .0100 comparable site using straight plus minus
d. .0097 adjustment
Formula a. P18,250.00 per sqm
Amortizations Factor = Si/S – 1 b. P24,000.00 per sqm
c. P25,750.00 per sqm
37. A property has 25 apartment units, 15 units d. P26,250.00 per sqm
two bedroom unit renting for P5,000.00 per 43. Building Residential, 4 T&B and 4 car garage
month each and 10 one bedrooms unit residential building was sold for
renting for 2,000.00 per month east. There P20,000,000.00 Using. The rules of thumb of
are 14 two bedroom units occupied and 8 building to land ratio of 3:2 what is the value
one bedroom units occupied. of the building?
The potential gross income yearly is. a. P10,000,000.00
a. P1,000,000.00 b. P11,000,000.00
b. P1,120,000.00 c. P12,000,000.00
c. P1,140,000.00 d. P8,000,000,00
d. P1,150,000.00 44. An appraiser was asked t compute for the
fair market rent per (square meter) of a
15 × 5K × 12 = 900K P500.00 per square meter vacant
10 × 2K × 12 = 240K commercial lot using the following
PGI = 1.14M assumptions
Fair market value of lot per sq.m –P12,00.00
38. If house in your area have increase in value Interest rate -10% p.a
8% during the past year and the average They yearly market rent is:
price of house sold last year was a. P500,000.00
P95,000.00. what is the average price of b. P600,000.00
houses sold today c. P700,000.00
a. P101,000.00 d. P800,000.00
b. P101,500.00 45. If a commercial structure is a rectangle with
a. P102,600.00 (95K × 1.08) sides of 65 meters and 135 and the current
c. P103,000.00 local cost to built a similar structure is
39. An appraisal is last to be made of a three- 4,500/sqm using the square meter method
bedroom house. One comparable with two a. P18,000,000.00
bedrooms sold for P50,000.00. the appraiser b. P180,000,000.00
makes an adjustment of P1,000.00 to the c. P 39,487,500.00 (65 × 135 × 4600)
comparable to account for the difference in d. P36,450,000.00
the number of bedrooms. The adjustment 46. A house and lot are priced at P8,800,000.00.
sales price of the comparable is: the lot alone is valued P1650,000.00. what
a. P49,000.00 percentage of the total asking price is
b. P51,000.00 attributable to the value of the lot?
c. P52,000.00 a. 18.8%
d. P53,000.00 b. 19.0%
40. Which of the following estimated would result c. 18 and ¾ % (1.65M/8.8M)
n a capitalization rate of 4 percent d. 18 and ¼ %
a. Potential gross income P200,000.00;
value P5,000,000.00 47. The basic formula for property valuation via
b. Effective gross income P200,000.00; income capitalization is:
value P5,000,000.00 a. Value=Income x Rate
c. Net operating income P200,000.00; b. Value= Income/Rate
value P5,000,000.00 c. Value=Rate/Income
d. None of the above d. Value=Selling Price/Income
41. In regard to zoning, which of the following 48. In a property residential capitalization
statement is CORRECT? approach what is the value an improved
a. Zoning ordinances are always more property with a net income of P80,000.00 a
restrictive that deed restrictions year, an interest rate 8% and rate recapture
b. A nonconforming use and variance refer of 2%?
to the same thing a. P1,000,000.00
c. Zoning normally establishes land-use b. P800,000.00 (80K/8%+2%)
districts and provided for different c. P840,000.00
restriction within each district d. P850,000.00
d. Exclusive zoning and spot zoning refers 49. If houses in your area have increased in
to the same thing valued 8% during the past years and the
42. A comparable site sold a month ago @ average price of houses sold last year was
P25,000.00 per square meter. Its location is P95,000.00. what is the average price
considered 15% superior and its and houses sold today?
topography is 10% inferior to the subject site. b. P101,000.00
 c. P101,500.00 d. P5,000
d. P102,600.00 (95K × 1.08) 56. An office building recently sold for
e. P103,000.00 Php50,000,000. Given the following
information:
50. What is the distinction between the term Gross (potential) income: Php10,000,000
market price and market value? Vacancy factor : 8 percent
a. Market price is what is the seller asks for, Expenses :45 percent of effective gross
while market is what the buyer actually income
pays Annual mortgage payment :Php4,125,000
b. Market price is what the property seller Equity :Php12,500,000
for, while market value is what is what What is the overall rate of return for the
the sales price should be to typical property? What is the pre-tax cash flow?
buyer a. 8.3 percent
c. Market price is what is currently owned b. 10 percent
the property, while market value is what is c. 10.12%
bought for d. 9%
d. Market price is synonyms with Solution.
replacement cost, while market value is 10M – 8% - 45% /50Mx100
the same as assessed value 57. If the subject property is 10% superior to
51. The assessor’s Office is an agency where we Comparable Sale no. 1 and the comparable
inquire and conduct research on sold for P1,000,000, what is the indicated
a. Title verification value of the subjected?
b. Certification lot plan a. P1,000,000 x 0.90=P900,000
c. Zonal value b. P1,000,000 x 1.10=P1,100,000
d. Cadastral map/tax map c. P1,000,0q00/1.10=P9069,090
52. An appraisal is best defined as: d. P1,000,000/0.90=P1,111,111
a. An unbiased opinion of the quality, value 58. A tenant has a least that states the base rent
or utility of an interest in real estate and is P5,000 per month plus 3% of the sales
related personality above P50,000 in gross sales per month.
b. An unbiased opinion of the likely price for The tenant’s sales last year were P850,000.
which a parcel of real estate would sell at How much rent was paid last year?
a given date a. P25,500
c. The process of studying the nature, b. P75,000
quality, or utility of an interest in real c. P60,000
estate in which a value estimate is not d. P67,500
necessarily required 59. If comparable sale# 1 sold for Php2,000,000
d. The process of developing an opinion and has two-car garage, adding Php100,000
as to market value or other defined to the value and the subject property does
value of a specified interest in a not have a garage, the indicated value of the
specified in time subject property would be found by:
53. Edwin owned a small farm of 1,500 sq.m in a. Subtracting Php100,000 from the subject
Antipolo. When he died, he had no heirs, no property
friends, and no will. b. Adding Php100,000 to the comparable
a. The state will take the property and sale
sell it c. Subtracting Php100,000 from the
b. The land will be in Bob’s name forever comparable sale
because he died without heir d. Adding Php100,000 to the subject
c. The land will pass to the first person to property
occupy the land for seven years (i.e., 60. A residence has been listed for sale for the
squatter’s rights) last six months at a price of P1,249,000 and
d. The land will pass to the adjacent owner it has not sold, in this market, the average
equally. marketing period is 45 days for this type for
54. A 7-years old residence is currently valued at property.
P720,000. What was the original if it has a. The subject property’s market value could
appreciated by 60% since it is built? be higher than the list price
a. P720,000 b. The subject property’s market value could
b. P450,000 be higher or lower than the list price
c. P378,000.00 c. The subject property’s market value is
d. P1,152,000.00 less than the list price
55. In a soft market a landlord accepted a new d. The subject property’s market value could
tenant with 60-month lease at P5,000 per be lower than the list price
month but gave the new tenant six months 61. A comparable property sold six months ago
free rent. Using the average rent method, for Php1,250,000. Market investigation
what is the effective monthly rent? indicates the following:
a. P5,555 Location adjustment +5 percent Adjustment
b. P4,500 (60×50)0/66) Sequence: Time, Age, Location
c. P3,000
 Time adjustment +6 perecent P1,250,000 X d. Appraisal guidelines
1.60 X.93 X 1.05 (round it) =1,293,862.5 69. An appraisal of real estate
Age adjustment +7 percent(dep-ed) a. Guarantee its value
b. Assure its value
Give the above information, what is the c. Determine its value
indicated value based on the comparable d. Estimates its value
property? 70. In which market is the direct sales
a. Php1,232,250.00 comparison approach most applicable?
b. Php1,300,000.00 a. Seller’s
c. Php1,325,000.00 b. Buyer’s
d. Php1,293,860.00 c. Reasonable
62. A property has an overhead garage door that d. Active
is 13 years old. It cost P19,000 to replace 71. The legal right to move items such as topsoil
Because the inclement weather comes outs or coal from another is known as a/an:
of the northwest, these doors typically last 15 a. Easement
years if they face the west and 25 years if b. Profit
they face east. This door faces east. What is c. Escheat
the amount of value left in this item? d. EMBLEMENTS/FRUITS
a. P9,120.00 72. The process of change the use of a building
b. P9,880.00 from an apartment complex to a
c. P16,470.00 condominium form of ownership is normally
d. P2,660.00 referred to as a (n):
13/15 (19,000) = 9,880 a. CONVERSION
19,000 – 9,880 = 9,120.00 b. Proration
63. The area of rectangle with a base of 10 c. Interim use
meters length and a length of 20 meters is d. Variance
a. 250 sq.m 73. Which approach would best when appraising
b. 200 sq.m (10×20) a 15-to-20 years old house?
c. 300 sqm. a. Cost
d. 400 sqm. b. Sales comparison
64. All of the following statement are true c. Income capitalization
except: d. Replacement cost new les depreciation
a. Real property refers to items that are 74. Before reconciliation the appraiser should
not permanently fixed to a part of the a. Re-inspect the subject property
real estate b. EVALUATION THE RELIABILITY OF
b. Appraising is the art and items that are EACH APPROACH TO VALUE
not permanently fixed to a part of the c. Review the over-all appraiser process
estate and check for technical accuracy
c. Assets value change with time d. Seek the property owner’s opinion
d. Market change with supply and demand 75. A large home built in an area of small cottage
65. The principle of substitution holds that a is an example of:
purchaser will pay not more for a property a. Over-improvement
than b. Under-improvement
a. The minimum he can afford c. Land regression
b. THE COST OF ACQUIRING AND d. Functional obsolescence
EQUALLY DESIRABLE SUBSTITUTE 76. The walls between two condominium units
c. The price of a previously owned property are NORMALLY considered to be:
d. The price of a property with grater utility a. Individual unit elements
66. Which of the following conditions is assumed b. Common elements
in the normal definition of market value c. LIMITED COMMON ELEMENTS
a. The estate value is as of a future date d. Propriety lease elements
b. The property will sell promptly 77. What would be the indicated value of a
c. Payment will be made in cash or its property that rented for P7,500 per month,
equivalent using a monthly gross rent multiplier of 110,
d. Only the buyer is knowledgeable as to the if the express attributable to the property
potential uses of the property were P1,250 per month?
67. In which market are the there many potential a. P756,700.00
buyers but few properties available? b. P825,000.00 (7,500 – 1,250)(12)(110)
a. Demand c. P687,500.00
b. Buyer’s d. P611,250.00
c. SELLER’S 78. A 7 years old residential is currently valued
d. Low-price at P720,000. That is the original value f it has
68. To estimate market value, an appraiser appreciated by 60 percent since it was built?
follows the a. P270,000.00
a. Appraiser report b. P378,000.00
b. Valuation process c. P450,000.00 (720K/160%)
c. Evaluation methodology d. P152,000.00
79. ____ includes not only the ground or soil but  Rooms is the number of rooms in the
everything which is attached to the earth apartment
whether by course nature or by man  Students id the percent of students in the
a. Land apartment building (0=- percent)
b. Building  Distance is the distance from the periphery
c. Other land improvements of the campus
d. Real Estate  The rent for an apartment with 3 rooms, 100
80. This evolution of value theory emphasized percent students and 50 meters from
the relationship of market price and value, campus would be:
normal value under conditions of balance a. Php1,500.00
supply and demand b. Php1,775.00
a. Social theory of Mill c. Php2,500.00
b. Cost theory of Adam Smith d. Php3,000.00
c. THEORIES OF AUSTRIAN SCHOOL 88. Building value :Php50,000,000.00
d. Theories of Physiocrats Net operating income :Php8,350,000.00
81. Under the international valuation standards Building capitalization rate :14 percent
(IVSC), two types of values are: Land capitalization rate :9 percent
a. Fair market value and sound value What is the residual income to the land?
b. MARKET VALUE AND NON-MARKET a. Php 1,350,000.00
VALUE b. Php 3,850,000.00
c. Economic value and market value c. Php 4,500,000.00
d. Fair market value and liquidation value d. Php 70,000,000.00
82. Under IVSC, the “C” standards for: 89. What is the present value of a 40-years net
a. Corporation income of Php 10,000 per year if payments
b. COMMITTEE are in advance and the net income is
c. Conference discounted at a rate of 12 percent?
d. Charter a. P82,330.00
83. A property with an annual net income of b. P82,438,.00
P382,500.00 was recently sold for c. P92,210.00
P4,250,000.00. the remaining economic life d. P92,330.00
of the building is estimated to be 25 years.
Linda value is estimated to be P900,000.00. 90. As the degree of risk and uncertainty
Based on the data gathered. The overall rate associated with the income potential of
of the property is: property increases, the income generated by
a. 8% that property may be capitalized a higher
b. 9% (382,500/4,250,000)(100) rate. This action will bring about which of the
c. 10% following results?
d. 12% a. A hgher capitalization rate will mean a
84. There are various types of appraisal reports. higher value
Which of the following step would be the final b. A higher capitalization rate will mean a
one taken the appraisal process? lower value
a. Narrative report c. A change in the capitalization rate will
b. Bank form report have no bearing on the estimate of value
c. PERSONAL LETTER OF OPINION d. A change in the capitalization rate will
d. Valuation report have an effect on value only if the
85. A house and lot is period at P7,500,000.00. property is being under its highest and
the lot alone is valued P2,531,250.00. what best use
percentage of the total asking price is 91. An office building has 1,00 square meters of
attribute to the house? net leased space. The owner has an annual
a. 33 ¾ % mortgage payment Php 750,000 and expects
b. 33 ¼% operating expenses to be Php 250,000. If the
c. 66 ¼% owner wants a before tax cash flow Php
d. 66 ¾% 500,000, what should the gross rent square
86. The value of the property with a monthly net meter be on a monthly basis?
income of P75,000.00 and with an overall a. Php 100
capitalization rate of 9% is. b. Php 125
a. P833,333.00 c. Php 150
b. P10,000,000.00 d. Php 1,500
c. P1,000,000.00 92. Demand is one of the essential elements
d. P900,000.00 or characteristics of value, however, for
demand to value where must also be.
A regression gives information to estimate
87. a. Purchasing power
monthly rent for apartments: b. Need
 Rent=250+(75xRooms)+(50xstudents) c. An adequate supply
+(25xdistance)= d. Good sales technique
 Where: 225 × 2 = 1,250 93. Which of the following calculations is NOT a
type of yield rate?
 a. INTERNATIONAL RATE OF RETURN b. 1 percent for each year property has
b. DISCOUNT RATE been rented
c. OVERALL CAPITALIZATION RATE c. Somewhere between 5 percent and 10
d. INTEREST RATE percent
94. What information is NOT needed to apply the d. THE AMOUNT WILL VARY WITH EACH
building residential technique? PROPERTY
a. Building value 102. Which of the following returns would be
b. Land value include in the capitalization rate established
c. Net operating income by the appraiser for a property with a
d. Land and building capitalization rate declining value a constant land value?
95. What term used to denote the difference, if a. Return on the land and building
any, between the present value of expected b. RETURN ON THE LAND AND
benefits, or positive cash flows, and the BUILDING AND RECAPTURE OF THE
present value of capital outlays, or negative BUILDING
cash flows? c. Return on the land and building and
a. Profitability index recapture of the land and building
b. Net present value d. Return on the land and building and
c. Internal of return recapture of the land
d. Net cash flow 103. In addition to the income generated by rents,
96. Given the following information what else does the income approach always
Building capitalization rate: require the appraiser to analyze?
Land capitalization rate a. Total debt service
Land value as a percent of total value: b. Pretax cash flow
What is the overall capitalization rate by c. OPERATING EXPENSES
using the band of investment approach? d. After-tax cash flow
a. 0.097 104. A 10-unit apartment complex has been
b. 0.100 purchased for Php 25,000,000. A 75 percent
c. 0.103 loan has been obtained. Vacancy allowance,
d. 0.110 operating expenses, reserve accounts, and
97. Given the following information, what is the debt services equal Php2,375,000 annually.
building capitalization rate for the subject How much must each unit rent for monthly to
property? generate a 10-percentr dividend rate?
Land value : Php600,000 a. P 23,750
Net operating income : Php250,000 b. P 24,000
Land capitalization rate : 8 percent c. P 25,000.00
Overall capitalization rate : 9 percent d. P 30,000.00
a. 10.9 percent 105. The mathematical process of converting
b. 9.3 percent investment in flows or an income into a
c. 8.4 percent present value is commonly referred to as:
d. 8.8 percent a. Compounding
98. If a property has a net income ratio of .75 b. DISCOUNTING
and gross income multiplier of 9, what is the c. Amortization
indicated overall capitalization rate? d. Equity reduction
a. 2.78 percent 106. In analyzing the market by using a gross rent
b. 6.75 percent multiplier (GRM) technique, value is
c. 8.33 percent estimated by doing which of the following?
d. 12.00 percent a. Dividing market rent by gross rent
99. The term holding period usually refers to multiplier
the: b. Dividing market rent by net income
a. Time span in which improvements c. Multiplying operating expenses by gross
continue to contribute to value rent multiplier
b. Period of time which net income remains d. MULTIPLYING MARKET RENT BY
greater than operating expense GROSS RENT MULTIPLIER
c. TIME SPAN OF OWNERSHIP 107. Which of the following statement is MOST
d. Period of time that this since construction descriptive of what occurs with a
of the improvements capitalization rate used in the income
100. Capitalization is the process of: approach to value?
a. Forecasting future yields of a property a. THE CAPITALIZATION RATE
b. Calculating expenses to find price INCREASES WHEN THE RISK
c. Deducting expenses to find net assets INCREASES
d. CONVERTING INCOME INTO A VALUE b. The capitalization rate increases when
INDICATION the risk increases
101. Which of the following statements BEST c. The capitalization rate increases when
describes the amount of adjustment an risk decreases
appraiser should make for vacancy d. The capitalization rate remains the same
allowance in a property? as long as there is possible net income
a. 5 percent of gross income
108. A set percentages indicating the c. Aid determination of how much
proportion of site value attributable to each property tax is due
additional amount of depth in the lot is 116. Deferred maintenance usually results in
referred to as: which of the following losses in value?
a. DEPTH TABLE a. Incurable physical depreciation
b. Multiplication tables b. Curable physical depreciation
c. Plottages c. Curable functional obsolescence
d. Grid d. Curable external obsolescence
109. Risk due to the use of depth financing is 117. What terms applies to the effect on value
referred to as: of location or proximity to the intersection
a. Interest risk of two streets?
b. Financial risk a. Corner influence
c. Leverage risk b. Amenity
d. Equity risk c. Externality
110. A large national tenant that occupies d. Plottage
space in a shopping center is often to as 118. Functional obsolescence could be caused
a (n): by which of the following?
a. Discount tenant a. A ceiling that is to high
b. Another tenant b. Deferred maintenance
c. Department store c. A poor location
d. Mall tenant d. A worn-out roof
111. Which of the following conditions is NOT 119. The building cost estimate method that
a basic assumption in the definition of replicates the contractor’s development of a
market value? bid and is the most comprehensive way
a. The seller receives cash or its equivalent estimate building costs, si known as the:
b. Both the buyer and seller are a. Unit-n-place method
knowledgeable about current market b. Quantity survey method
conditions c. Breakdown method
c. The value will be as of a specific date d. Comparative unit methods
d. The property will sell promptly 120. Included in the cost approach to value is all
112. Which of the following conditions is of the following components EXCEPT:
assumption in the normal definition of market a. Replacement cost
value? b. Highest and best of the land
a. The stated value is a of a future date c. Acquisition cost
b. The property will sell promptly d. Accrued depreciation
c. Payment will be made in cash or its 121. In regard to accrued depreciation, which of
equivalent the following terms does NOT belong
d. Only the buyers knowledgeable as to the together?
potential uses of the property a. Physical deterioration-curable
113. In considering the highest and best use of a b. Functional obsolescence-incurable
parcel of land to be improved with an office c. Economic obsolescence-curable
building the appraiser determine the optimal (incurable)
land to building ratio for the parcel. Which d. Functional obsolescence-curable
of the following economic principles does this 122. The combining of two or more into a
illustrate? single ownership with the value of the
a. Anticipation assembled lots being more than the sum of
b. Balance the values of the individual lot is referred to
c. Contribution as:
d. Substitution a. Highest and best use
114. An existing site has an improvement on it b. Economic rent
such as a building. Which of the following c. Escheat
statements BEST describes the highest and d. Plottage
best use of that site? 123. Another term used to denote the actual age
a. It cannot determined of a building is
b. It is automatically the current use the site a. Chronological age HISTORICAL
is improved b. Effective age
c. It may be different from the current c. Economic age
use (IMERIM USE) d. Depreciated age
d. If the improvement is a residence, then 124. A building has a roof that originally had an
the land does not have a highest and best expected life of 25 years. The roof’s effective
use age is 15 years. A new roof will cost
115. A tax assessment is intended to accomplish Php100,000 to install. Using a straight line
which of the following results? method, what amount of depreciation would
a. Set the maximum price paid at a be charged of the roof?
foreclose sale a. Php40,000
b. Establish the asking price of property b. Php60,000
when listed for sale by the owner c. P580,000.00
 d. P100,000.00 133. In collection data, an appraiser concludes
125. The basic capitalization formula used in that comparable properties have increased in
the income approach to value contains value at a 6-pecent for a comparable that
three Components. Those three components sold years ago for Php1,000,000 is:
are: a. Php60,000
a. Market, cost, income b. Php120,000
b. Value, rate, income c. P123,600.00 (1.06)2
c. Physical, functional, economic d. P1,123,600.00
d. Potential, gross, net income Sol. 1M(1.06)2
126. What is the gross income multiplier for a 134. Which of the following actions is NOT
property with a current market value of characteristic of market value?
Php570,000 and rents for Php5,000 per a. Sale as soon as possible
month? b. Well informed buyers
a. 9 c. Typical financing
b. 9.5 d. Typically motivated sellers
c. 10 135. Which of the following factors is NOT
d. 10.5 normally considered to affect the supply
Sol. 5k × 12 = 60k of real estate?
570k/60k = 9.5 a. Volume of new construction
127. The peso amount of rent received from a b. Standing stock
parcel of real estate when rented in an open, c. Land use and city growth
competitive market is referred to as: d. Competition
a. Economic rent market 136. What term best describes the effect of a
b. Contract rent power on the value of a nearby home?
c. Ground rent a. Balance
d. Gross rent b. Externalities
128. A mortgage loan for Php 300,000 at 9 c. Contribution
percent annum for 30 years has been made. d. Conformity
What is the amount of interest for the first 137. Which of the following appraisal principles
month? holds that market value is indicated by
a. Php163.90 the value of another property with similar
b. Php900.00 utility?
c. P2,250.00 a. Supply and demand
d. P2,413.90 b. Substitution
Sol. 9%/12 = 0.0075 × 300K = 2,2250 c. Competition
129. What is the range of a group of variables d. Balance
indicate to the appraiser? 138. The specific use of a parcel of land that
a. The value of the highest sample gives that land the greatest residual of
b. The difference between the lowest and income is referred to as the land’s
the highest values a. Intrinsic use
c. The average for the group b. Highest and best use
d. The percentage variation from the mean c. Income producing use
130. Which of the following types of lease does d. Efficient use
NOT provided at least some protection to the 139. The proper or most correct of an
lessor against inflation? improvement to land, such as the
a. Flat lease construction of a house, is normally
b. Index lease strongly influenced by the application of
c. Reappraisal lease which of the following economic principles?
d. Graduated lease a. Conformity
131. Which of the following statement is b. Encroachment
CORRECT in regard to assessed value? c. Escheat
a. The assessed value must equal the d. Substitution
market value 140. The term lenders often use to refer to the
b. The assessed value is used primarily relative amount of money they will lend
to calculate property taxes on a specific parcel of property is known
c. The assessed value is used primarily to as:
calculate property insurance a. Gross rent multiplier
d. The assessed value will never exceed b. Debt-to-equity ration
cost c. Value to loan ratio
132. A father sells his home to his daughter and d. Loan to value ratio
her husband. Such a sale would NORMALLY 141. Effective demand in the market place for
be described as which of the following sales? housing varies MOST directly with which of
a. Arm’s-length sale unrepresentative the following conditions?
b. Illegal sale a. Purchasing power
c. Distorted sale b. Interest rates
d. Forced sale c. Lis pendens
d. Escheat
142. A worn path crosses an owner’s property. 150. Which of the following terms refers to the
What legal doctrine would require a potential stages that a neighborhood goes through
purchaser to take note of the fact that there over time?
may be an unrecorded prescriptive easement a. Revitalization
against that property? b. Leasehold cycle
a. Actual notice c. Life cycle
b. Constructive notice d. Change
c. Lis pendens 151. The term appraisal refers to:
d. Escheat a. The process of estimating the market
143. An individual owner of a condominium unit is value of property
in default on payment of the property taxes to b. The valuation of a market and how it
the local government Of the following affects property values
choices, which is the only available to the c. The process of estimating the most likely
taxing authority? sales price of a property
a. Levy the tax on the entire condominium d. The act of process of developing an
project opinion of value
b. Procedure against the individual unit 152. The date of valuation for an appraisal is
c. Place a lien on the common areas determined by which of the following?
d. Foreclose against the homeowners a. The actual date the appraisal is signed
association b. The date the appraisal assignment is
144. The legal right of government to acquire accepted
private property for a public use or purpose c. The date the property is actually
with just compensation is known as: inspected
a. Nothing d. Whatever date is specified in the
b. Air rights only appraisal report
c. Everything below the surface only 153. What is the PRIMARY purpose of economic
d. Every above and below the surface base analysis?
145. In regard to the legal concept of land, what is a. To forecast future economic growth in
a landowners entitled to in additional to the an area and divided that growth
surface rights? between basic and non-basic
a. Nothing industries
b. Air rights only b. To forecast changes in local zoning
c. Everything below the surface only ordinances
d. Everything above and below the c. To determine property tax rates and the
surface likely amount of tax due on property
146. The term real estate is generally d. To forecast inflation rates
a. Air and sub surface rights 154. In using the sales comparison approach, the
b. Surface rights only appraiser finds that in term of location, sale1
c. Machinery and equipment is superior to the subject property but is
d. Legal interests and rights inherent in inferior to sell#2. The correct procedure
ownership would be to adjust:
147. Which of the following activities is NOT a a. Both sales down to the subject
public limitation on real estate property
a. Building codes b. Both sales up to the subject property
b. Zoning c. Sale#1 down and selle#2 up
c. Adverse possession d. Sale#1 up and sale#2 down
d. Fire codes 155. A single-family residential located on a busy
148. If the metes and-bounds method of legally street rents for Php500 per month less than
describing land is being used, which of the similar rental properties located on other
following statement is CORRECT? streets in the same area. The average gross
a. The straight point must be an natural rent multiplier in this neighborhood id 110.
benchmark What is the lump peso adjustment for the
b. There must be a define point of locational obsolescence of the residence?
beginning a. P500
c. Monuments cannot be used as part of the b. P6,000
description c. P50,000.00
d. No other methods, such as lot-and-block, d. P55,000.00.
can be used as part of the description Sol. 5k × 110%
149. Which of the following terms refer to the 156. The adjustment in the sales comparison
legal interest belonging to a person who approach that involves comparing two
is leasing property from someone else? properties with similar feature and
a. Leased fee estate characteristics but different date of sale is
b. Leasehold estate referred to as the:
c. Fee simple estate a. Loan closing adjustment
d. Lesee’s estate b. Time adjustment (market
contributions)
c. Appreciation in value adjustment
 d. Time value of money adjustment 165. The sale comparison approach is said to
157. The building cost method that finds the cost be most reliable when of the following
of the component parts of a building through market exist?
standard cost estimated and then adjusts for a. Active market
the condition of the component, time and b. In acted market
location is known as the: c. Buyer’s market
a. Unit-in-place method d. Seller’s market
b. Quantity survey method 166. Numerous elements should be identified
c. Break-down method when an appraiser is attempting use the
d. Comparative unit method sale comparison approach to value. Which
158. Maria’s house was built 12 years ago. of the following list BEST explains elements
Because he keeps it in excellent condition, it of comparison?
shows only as much wear as a typical five- a. Demand, supply, utility, transferability
year-old house. Maria’s house therefore has b. Physical, functional, economic, location
an effective age of: c. Date of sale, location, physical,
a. 5 years condition of sale
b. 7 years 167. In the short run, which of the following
c. 12 years conditions has the MOST effect on real
d. 17 years estate price?
159. Which of the following methods is the MOST a. More changes in demand than changes
detailed in estimating the costs of in supply
reproducing abuilding as part of the cost b. More changes supply than in demand
approach to value? c. More inflation than demand
a. Unit-in-price d. More sellers than buyers
b. Quantity survey 168. What term is used to describe the value to a
c. Comparative unit typical investor?
d. Trade breakdown a. Market value
160. The cost approach to value takes into b. Investment value
consideration all of the following factors c. Sale value
EXCEPT: d. Use value
a. Value of the land
b. Replacement (Reproduction) cost of the 169. Which of the following estimates would
improvements result in a capitalization rate of 20
c. Original sales price percent?
d. Physical defects a. Potential gross income P1,000,000, value
161. When using cost approach to value, an P5,000,000
appraiser should value the land as though: b. Effective gross income P1,000,000, value
a. It has been improved with a building P5,000,000
b. It is currently being used with an interim c. Net operating income P1,000,000,
use value P5,000,000
c. It is vacant and available for highest d. Cash flow P1,000,000, value P5,000,000
and best use
d. Zoning ordinance are not 170. A property has NOI of Php1,000,000, interest
162. A tract of land containing four hectares payment of Php800,000 and principal
recently sold for Php600 per square meter. payments of Php100,000. What is the debt
What is the estimated land value? coverage ratio?
a. P600,000.00 a. 0.80
b. P2,400,000.00 b. .0.90
c. P6,000,000.00 c. 1.11
d. P24,000,000.00 d. 1.25
Sol 600 × 40,000 171. A small restaurant contains an oven and a
163. What is the correct percentage of accrued freezer, each of which cost Php9,000 and
depreciation for a 15-year old building if the has estimated useful life of 10 years
building has an effective age of 20 years and Carpeting costs Php35,000 and has an
a remaining economic life of 30 year? estimated usefull life of seven years. What
a. 20 percent annual reserve for replacement would be
b. 30 percent appropriate for these items?
c. 40 percent a. P5,900.00
d. 60 percent b. P6,070.00
164. What term applies to the rent specified in a c. P6,800.00
lease? d. P5,000.00
a. Based rent 172. If a property has an overall capitalization rate
b. Market rent of .095 and a mortgage at a 75 percent loan-
c. Contract rent to value ratio having an annual mortgage
d. Gross rent constant of .11, what is the equity dividend
rate?
a. 0.05
 b. 0.06 b. Market price is what the seller asks for,
c. 0.07 while market value is what the buyer
d. 0.09 actually pays
173. The term effective rate refers to the: c. Market price is what the property sells,
a. Loan constant on a mortgage for, while value is what sales price
b. True rate of return considering all should be to a typical buyer
relevant finance expenses d. Market price is what is currently owned
c. Interest rate after inflation is considered the property, while market value is what is
d. Rate at which future payments are bought for
discounted to present cash flows 181. Under which of the following conditions
174. What is the present value of a 40 years net would an appraiser appraise the value of
income of Php10,000 per year if payment are the property as of future date?
in advance and the net income is discounted a. If the current use is the highest and best
at a rate of 12 percent?(Factor=8.233030) use
a. P82,330 b. If the appraiser uses all three approaches
b. P82,438 to value
c. P92,210.00 c. If the market is stable and there is no
d. P92,330.00 inflation
175. When a property’s vacancy and bad debts d. If the value is appropriately defined for
is building from the property’s gross a future date of the value
(potential) income which of the following 182. What type of analysis identifies land uses
incomes is derived? that are legally permissible, physically
a. Effective gross income possible and financially feasible?
b. Net operating income a. Sensitivity
c. Taxable income b. Highest and best use
d. Cash flow income c. Feasibility
176. The basic equation in the income approach d. Supply and demand
to value is: 183. Included in the definition of highest best use
a. Rate divided by income equal value are certain tests or criteria that must be met.
b. Income divided by rate equals value Which of the following condition is NOT a
c. Rate times income equals value certain the highest and best use of land?
d. Rate plus income equals value a. Physical possible
177. One of the standard techniques by b. Legally permissible
appraisers when analyzing the income of c. Financially feasible
property is to divided the income being d. Supply and demand
generated between the land and the 184. When two or more individual parcels are
improvements and then to capitalize the legally encumbered by one mortgage and
residential income to the improvements into one of the parcels is to be freed from the
a estimate. Such a techniques is referred to encumbrance, the instrument used is a (n):
as the: a. Partial release of mortgage
a. Land residential technique b. Satisfied agreement
b. Building residential technique c. Sub assignment of mortgage
c. Property residential technique d. Estopped certificate
d. Plottage residential technique 185. Which of the following statement is NOT
178. The income approach to value: necessarily correct about a local zoning
a. Is based on the principle of anticipation ordinaries?
b. Translated the ability of property to a. Zoning can establish height restriction on
generate income into an indication of building
value b. Zoning is often used to separate
c. Requires an estimate of net operating income incomparable land uses
income of property c. Zoning is often used separate
d. All of the above are correct incompatible land uses
179. The lump sum that an investor at the d. Zoning establishes setback requirements
termination an investment is referred to as for improvements on land
the: 186. A mortgage secured by a legal claim
a. Remainder against two or more separate properties is
b. Reversion referred to as a:
c. Lump sum a. Wraparound mortgage
d. Gain b. Participation mortgage
c. Blanket mortgage
180. What is the distinction between the terms d. Ground lease mortgage
market price and market value? 187. The property tax due on real estate
a. Market price is synonymous with calculated by what method?
replacement cost, while market value is a. A condominium the tax rate by the
the same as assessed value assessed value
b. Multiplying the tax rate by the
assessed value
 c. Dividing the tax rate by the most probable property is P480,000 the property’s annual
sales price gross income multiplier is
d. Multiplying the rate by the most probable a. 7
sales price b. 9 (480K)/(750×6×12)
188. Which of the following is deducted from c. 54
potential gross income to calculate effective d. 10
when using the income approach? 197. An appraiser calculates a separate value for
a. Legal expenses the land when using the
b. Repairs a. Sales comparison approach
c. Loan payments b. Income approach
d. Vacancy loss c. Cost approach
189. Estimating the value of property requires a d. Gross rent multiplier approach
systematic set of procedures. The first in the 198. If an appraiser uses more than one appraisal
appraisal process is typical to method and assign deferent weights to
a. Develop an appraisal plan results of each, she is using
b. Collect general data on the area a. Substitution
c. Define the purpose of the appraisal b. Contribution
d. Estimate the value of the land c. Replacement
190. What is the value of a property that produces d. Reconciliation
gross income of P94,000 and the GIM is 8.5? 199. An apartment building has a capitalization
a. P66,583 rate of 6 percent. If the expenses on the
b. P110,588 property increase by P6,000 while the rent
c. P132,706 remain the same, the property value will
d. P799,000 (94K×8.5) a. Remain unchanged
191. An appraiser would use the cost approach b. Increase by P6,000
as the primary appraisal method for a c. Decrease by P36,000
a. Parking garage d. Decrease by P100,000 (6K/6%)
b. Condominium
c. Shopping mall 200. It is a legal principle that if at the end of the
d. Public school lease period the lessee continuous
192. An investor purchased a property for occupancy with the acquiescence of the
P450,000. If the property has annual net lessor and without notice to vacate, it is
income of P36,000, the capitalization rate on understood that there is an implied new
the investment is lease.
a. 6.6 percent a. Pactum de non aliendo
b. 8 percent 36K/450K b. Pacto de retro
c. 9 percent c. Pactum Commisorium
d. 12.5 percent d. Tacita Reconducta
193. If appraising a newly single-family house, 201. An authority given by the developer to a
an appraiser would be most interested in the broker to look for a supplier of backfilling
a. Cost constructing the house materials who shall be with developed lot is:
b. Capitalization rate of the house a. Procurement agency
c. Location of the house b. General brokerage
d. Gross rent multiplier c. Exchange agency
194. To calculate the monthly gross rent multiplier d. Sales agency
of a property
a. Multiply the monthly gross income by 12 202. Per BIR 28-98, the ground floor of a
b. Divide the purchase price by the gross condominium project shall be commercial
monthly income and additional rate shall be added to an
c. Divide the capitalization rate by the established residential zonal value
monthly gross income a. 10%
d. Divide the annual gross income by the b. 20%
purchase price c. 25%
195. Using the cost approach an appraiser d. 15%
determines that the value of a property is 203. The rate of real estate tax in municipalities
P230,000. If the appraiser estimated the cost within Metro Manila is not more than:
of replacing the structures on the property at a. One-half percent assessed value
P160,000 and the value at P90,000, what b. Two and a half percent of assessed value
was the amount of accrued estimated by the c. One percent of assessed value
appraiser for the property? d. Two percent of assessed value
a. P10,000 204. The payment of estate tax, an allowed
b. P20,000 (160K+90K-230K deduction to the gross estate of a decedent
c. P60,000 is funeral expenses which is
d. P90,000 a. 5% of gross estate or P200,000.00
196. An apartment building has six units that rent whichever is lower
for P750 a month. If the purchase price of the b. 5% of gross estate or P200,000.00
whichever is higher
 c. 10% of gross estate or P200,000.000 c. Fixed Assets
whichever is lower d. None of the above
d. 10% of gross estate or P200,000.00 214. Several houses valued at P1,000,000.00 and
whichever is higher P2,000,000.00 were built an area where an
a. existing house valued at P300,00000 is
205. The capital gains tax due on the sale of located. As a result, the value of the latter
P2,000,000.00 property with P500,000.00 increased. The real estate principle of value
initial payment is: that applies to this situation is called the
a. P100,000.00 principle of
b. P120,000.00 a. Substitution
c. P20,000.00 b. Improvement
d. P30,000.00 (500K×6%) c. Progression
206. The best evidence fee simple ownership is a d. Regression
Torrens Title because it is indefeasible and : 215. Capital Gains Tax on the sale of real
a. Imprescriptible classified as capital assets is a:
b. Binding against the whole world a. Creditable tax on the sale
c. Has priority against a tax declaration b. Deductible item from income tax
d. All of the above c. Final withholding tax
207. Under R.A. 8791, the maximum redemption d. Expanded withholding tax
period after extrajudicial foreclosure of a 216. The real estate broker is usually authorized
mortgage executed by a corporation in favor to do all of the following except:
of the bank is: a. Advertise the listing
a. 3 months b. Cooperative with brokers
b. 6 months c. Place for sale sign on the property
c. 12 months d. Bind the principal in a contract
d. none of the above 217. When a property is sold to 2 or more buyer’s
208. A clause used in leases and mortgages that the property goes to
cancel specified right upon the occurrence of a. Buyer in good faith and who first
condition such as cancellation of mortgage registered with Register of Deeds
upon repayment of mortgage loan: b. Buyer who pays the highest price
a. Acceleration Clause c. Buyer who was first in possession
b. Defeasance Clause d. None of the above
c. Automatic Redemption Clause 218. The position of trust assumed by the broker
d. Hold over Clause as an agent for the principal is described as:
209. In sale with assumption of mortgage, the a. Trusteeship
basis of the documentary stamp on the sale b. Confidential
is c. Fiduciary relationship
a. The down payment d. Code of conduct
b. The contract price 219. If the property is an ordinary assets, what is
c. Selling price the applicable tax?
d. None of the above a. Capital Gains Tax
b. CWT
210. When the loan is fully amortized by equal c. Percentage tax
monthly payment the amount applied to the d. Estate tax
principal:
a. Decreases while interest payment 220. The type of loan wherein the lender has
increases some or complete control over the project
b. Increases while interest decreases and the income for a certain period, part or
c. Increase by a constant amount all which is assigned to him to amortize the
d. None of the above project, is:
211. To avail of exemption from capital gains in a. Straight Loan
the sale of a family home, the seller is b. Flat Loan
required, among others, to notify the BIR c. Turn-key loan
through a prescribed form his intention to
avail of the exemption. The notice must be 221. The Seller realized a 30% gross profit over
filed within: his cost. If the property is sold at
a. 15 days from the date of sale P1,950,000.00, the cost is:
b. 30 days from the date of sale a. P1,365,000.00
c. 60 days from the date of sale b. P1,350,000.00
d. None of the above c. P1,650,000.00
212. d. P1,500,000.00
213. On bank’s acquired assets which part of its
real estate inventories at the close at the 222. The documentary stamp on lease of real
close of its accounting period shall be estate is P3.00 for the first P2,000.00 or
classified as: fraction thereof and additional:
a. Ordinary Assets a. P0.50 for every P1,000.00 in excess for
b. Capital Assets first P2,000.00
 b. P1.00 for every P1,000.00 in excess for 231. The estate Tax Return shall be filed and paid
first P2,000.00 with the BIR within:
c. P1.50 for every P1,000.00 in excess for a. 60 days from death of decedent
first P2,000.00 b. 90 days from death of decedent
d. P2.00 for every P1,000.00 in excess for c. 120 days from death of decedent
first P2,000.00 d. 180 days from death of decedent
223. The selling price if house and lot is
P800,000.00. if its appraised value of a.
P720,000.00 and loan to collateral ratio is 232. When to file Estate Tax return upon
80% what is it loan value? decedent death
a. P640,000.00 a. Within 3 months
b. P576,000.00 b. Within 4 months
c. P720,000.00 c. With 5 months
d. P648,000.00 d. Within 6 months
224. The capital gains tax on the sale of e. Within a year
P2,000,000.00 property with P600,000.00 233. When to pay Estate Tax if the case is settled
initial payment is: judicially
a. P100,000.00 a. Not exceeding2 years
b. P120,000.00 b. Not exceeding 3 years
c. P30,000.00 c. Not exceeding 4 years
d. P36,000.00 d. Not exceeding 10 years
225. What is the cost of the fence with total length e. Not exceeding 5 years
of 75 meters, with height above the ground of 234. A residential parcel of land located outside
2 meters and ½ meter below, if cost square metro manila has a Market value of
is P1,500.00? 500,000.00. how much is the basic yearly
a. P225,000.00 real property tax?
b. P281,250.00 a. 5,000.00
c. P140,625.00 b. 1,500.00
d. P112,500.00 c. 1,000.00 (500K×20%)×1%
226. Using the 4-3-2-1 rule (depth rule) if a 5- d. 2,000.00
hectare belonging to different owners was 235. An industrial parcel of land located outside
sold for P10,000,000.00 what is the sum metro manila has a Market value of
share of lot owners owning the first quarter 5,000,000.00. How much is the basic yearly
abutting the road? property tax and special education fund Tax?
a. P2,500,000.00 a. 75,000.00
b. P4,000,000.00 b. 50,00.00
c. P5,000.000.00 c. 60,000.00
d. P6,000,000.00 d. 100,000.00
236. The Net Taxable estate of the decedent is
227. When a done of a parcel of land is a 15,000.00 How much is the estate Tax?
stranger, the donor’s tax rate is: a. 2,215,000.00
a. 20% b. 3,500,000.00
b. 6% c. 1,750,000.00
c. 30% d. 2,650,000.00
d. 25% 237. Mr. Reyes the Donee donated worth
228. The collateral value of a house and lot 400,000.00 of car to his brother. How much
package is determined by applying the: is the donor tax?
a. Economic Value a. 12,000.00
b. Assessed Value b. 8,500.00
c. Appraised Value c. 9,750.00
d. Loan to Value Ratio d. 10,000.00
238. Ms. Beautiful donated 1,500,000.00 worth of
229. The use of borrowed funds to increase Rolex watch to Mr. Pogi who is a stranger.
purchasing power is ideally to increase the How much is the donor’s tax rate of Ms.
profitability of an investment is: Beautiful?
a. Limited Liability a. 25%
b. Debt coverage b. 35%
c. Leverage c. 15%
d. Interim financing d. 30%
230. The amount of family home equivalent to fair 239. A machine classified as Residential worth
market value considered as allowable 250,000.00. How much is the Assessed
deduction from the estate of a decedent: Value?
a. P500,000.00 a. 225,000.00
b. P1,000,000.00 b. 125, 000.00
c. P2,000,000.00 c. 200,000.00
d. P750,000.00 d. 100,000.00
240. A machine classified as Agricultural worth as
Agricultural worth 250,000.00. How much is
the Assessed Value?
a. 225,000.00
b. 125,000.00
c. 200,000.00
d. 100,000.00
REAL ESTATE LAWS TAXATION c. Ordinary asset

1. Land covered by the Agrarian Reform Code 12. The highest price in terms of money which a
except. property can command if exposed for sale in the
a. Old Settlements open market.
b. Tenanted Areas a. Fair Market Value
c. New Areas b. Market Value
c. Best Value
2. The slow pace of agrarian reform
implementation is due to. 13. Percentage of fair market value at which the
a. Social will assessed value is set.
b. Political will a. Base level
c. Economic will b. Percent level
c. Assessed level
3. Comprehensive Agrarian Reform Law was
signed. 14. The fair market value of real property
a. July 21,1990 multiplied by assessment level. It is synonymous
b. June 10, 1988 to taxable value.
c. August 8,1988 a. Assessment
b. Assessed Value
4. Philippine state policy that ensures and c. Tax Assessment
promotes welfare of landless farmers and farm
workers. 15. Percentage of assessed value at which the
a. Voluntary Sell realty tax is arrived at.
b. Homestead a. Tax Rate
c. CARP b. Assess rate
c. Value rate
5. The lead implementing agency of CARP
a. Landbank 16. The use to which the property is principally
b. DAR or predominantly devoted.
c. DILG a. Actual use
b. Principal use
6. Green color in the DAR logo stands for. c. Primary use
a. Agriculture 17. This is a kind of tax levied by the local
b. Life and Vitality government on properties and should be paid by
c. Fertility and Productivity property owners.
a. Value Added Tax
7. Refer to natural person whose primary b. Income Tax
livelihood is the cultivation of land. c. Real Property Tax
a. Farmer d. Donor’s Tax
b. Gardener
c. Laborer 18. Special education fund tax
a. 1%
8. Women who are engaged directly or indirectly b. 2%
in farming and/or fishing as their source of c. 3%
livelihood, whether paid or unpaid, regular or
seasonal. 19. Discount if payment is made in advance.
a. Urban women a. 20%
b. Rural women b. 30%
c. Laborer women c. 35%

9. Award limit to farmer under PD 27 if the land 19. Most superior lien on real property.
is not irrigated. a. Mechanic lien
a. 5 hectare b. Mortgage lien
b. 3 hectare c. Tax lien
c. 4 hectare
21. Delinquent taxpayer whose real property
10. Farmer's amortization under PD 6657 for sold on public auction can redeem property after
payment of land. sale.
a. 30 years a. Within 1 year
b. 25 years b. Within 3 months
c. 15 years c. Within 6 months

11. Real property used in trade or business is 22. Interest on delinquent real property tax per
classified as. month.
a. Business asset a. 2%
b. Capital asset b. 3%
c. 4% 33. Provided mechanism for the implementation
of the Comprehensive Agrarian Reform Program
23. Interest on unpaid real property tax shall in (CARP).
no case exceed. a. EO 21
a. 36 months b. RA 9700
b. 12 months c. EO 229
c. 24 months 34. The responsibility to determine land
valuation and compensation for all lands
24. Asset not part of inventories for sale or used covered by CARP.
in trade such as the residential lot. a. DAR
a. Ordinary Asset b. Appraiser
b. Capital Asset c. Land Bank
c. Personal asset
35. Identifies and screens potential
25. Months required to build new house to avail beneficiaries and validates their qualifications.
exemption from capital gain tax a. DENR
a. 18 months b. DAR
b. 24 months c. Barangay Official
c. 36 months
34. Lead agencies in the implementation of carp,
26. Gross selling price of residential lot subject except
to vat. a. DENR
a. Exceeding 1,919,500.00 b. DAR
b. 1,900,000.00 c. Landbank
c. 3,000,000.00
37. Shall coordinate and monitor the
27. Gross selling price of of other residential implementation of the CARP in the province.
dwelling subject to vat. a. Provincial Agrarian Reform Coordinating
a. Exceeding 3,199,200.00 Committee (PARCCOM)
b. 1,919,000.00 b. CARP Monitoring Committee
c. 3,000,000.00 c. Provincial CARP Monitoring

28. Under TRAIN Law, Lease of residential 38. Exemption on CGT sale of principal
units with a monthly rental per unit subject in residence can be availed only once every.
order to be exempted from vat. a. 10 year
a. Below 10,000 b. 5 years
b. Below 10,800 c. 3 years
c. Below 12,800
d. Below 15,000 39. Percentage of payment for an installment
sale to pay creditable withholding tax.
29. CARPER signed into law a. 2%
a. August 5, 2005 b. 25% of selling price
b. August 7, 2009 c. 30%
c. July 21,19888
40. Tax rate for the cooperative registered in
30. Letter informing a landowner that his/her CDA.
land is covered by CARP. a. 0%
a. Notice of Coverage b. 3%
b. Notice of CARP c. 5%
c. Notice Landbank

31. Authorized to divide the Philippines into 41. Real property tax share of the barangay.
different zones or areas and shall, upon a. 25%
consultation with competent appraisers both b. 30%
from the private and public sectors, determine c. 40%
the fair market value of real properties. 42. Real property tax share of the municipality.
a. Commissioner a. 40%
b. DILG b. 50%
c. Mayor c. 60%

32. If fair market valued prepared by assessor 43. In general the real property tax share of the
is higher than prepared by BIR, the one shall be barangay.
followed for taxation. a. 30%
a. BIR b. 35%
b. Assessor c. 40%
c. Court
44. Real property tax share of the barangay in b. 90 days after completion
the city. c. 120 days after completion
a. 30%
b. 40% 55. Donor tax when beneficiary is stranger.
c. 50% a. 40%
b. 25%
45. Real property tax share of the city. c. 30%
a. 60%
b. 70% 56. Engage in the business of leasing or renting
c. 40% real estate properties.
a. Real estate lessors
46. Seller shall pay to the provincial treasurer b. Developers
the real property tax from date of notarization. c. Manager
a. Within 90 days
b. Within 60 days 57.Engage in the business of developing real
c. Within 30 days estate properties into subdivision or similar units
on subdivided lots.
47. Seller shall pay to the provincial treasurer a. Manager
real property tax from date of execution of sale. b. Real estate developer
a. Within 60 days c. Corporation
b. Within 30 days
c. Within 90 days 58. Before commencing any business and
payment of taxes.
48. Right of the delinquent owner to redeem a. Register with the municipal
the property from the date of sale. b. Register with the barangay
a. Within 2 year c. Register business with BIR
b. Within 3 years
c. Within 1 years 58. Registration requirement in BIR for
individuals.
49. Allowable period for assessment of taxes a. By laws
prior to initial assessment of real property taxes. b. Articles of Incorporation
a. 3 years c. Birth certificate or ID
b. 5 years
c. 10 years 59. Registration requirement for general
partnership.
50. LGU Sanggunian may condone real property a. Owner ID
tax upon recommendation of local disaster b. Articles of partnership
committee due to reasons, except. c. Voters ID
a. General failure of crops
b. Abundance season 61. Application form for individual in registering
c. Calamity with BIR
a. BIR form 1903
51. The basic real property tax and other b. BIR form 1902
taxes can be collected from the date they c. BIR form 1901
become due and no collection shall be made
after that period. 62. Application form for partnership
a. Within 5 years a. BIR form 1903
b. Within 10 years b. BIR form 1904
c. Within 15 years c. BIR form 1905

52. The basic real property tax and other 63 Under Train Law, The VAT Exempt
taxes can be collected from the date they Threshold on sale or lease of goods or
become due and no collection shall be made PROPERTIES or the performance of services is
after that period if done fraudulently. increased from P1, 919,500 annual gross sales
a. Within 20 years and/or gross receipts to
b. Within 15 years a. P2,919,500
c. Within 10 years b. P3,000,000
c. P3,919,500
53. Shall file a sworn declaration of value of d. P4,000,000
the property once every three (3) years.
a. Tenant 64. Under the Train Law, Condominium dues
b. Owner such as association dues, membership fees,
c. Assessor and other assessments and charges collected
on a purely reimbursement basis by
54. Owner shall file a sworn declaration of the Homeowner’s association and condominium
true value of the property being improved. corporations established under RA 9904 are
a. 60 days after completion exempt from ________
a. Non-Vat or percentage tax a. Invoices
b. Withholding Tax b. Official receipts
c. Vat Tax c. Inspection paper

65. Rate of percentage taxes on gross sales or 76. Maximum optional standard deduction.
professional fees of Non-VAT registered a. 40%
persons b. 30%
a. 3% c. 20%
b. 4%
c. 5% 77. Tax rate for corporation and partnership
a. 25%
66. Form used to update information like b. 40%
address and etc. c. 35%
a. Form 1905
b. Form 1906 78. Expanded withholding tax rate if professional
c. For 1903 fees to juridical entities exceed 720,000.00
a. 15%
67. Penalties on failure to pay annual b. 20%
registration fee. c. 25%
a. 10% surcharges
b. 30% 79. Expanded withholding tax rate if professional
c. 25% fees to individuals below P3,000,000.00
a. 5%
68. Unlawful pursuit of business or omission. b. 10%
a. Fine not less than 5,000 but not more c. 15%
than 20,000
b. Fine not more than 5,000 but not more than 80. Under Train Law, Documentary Stamp Tax
20,000 Percentage for Deeds of Sale, Conveyances
c. Fine not less than 10,000 but not more than and Donation of Real Property is now
20,000 a. 1.5%
b. 2%
69. Imprisonment on unlawful pursuit of c. 3%
business or omission.
a. 6 years but not more than 20 years 81. Professional if there is no payment to be
b. 5 years but not more than 20 years made.
c. 6 years but not more than 15 years a. Shall still file tax returns
b. No need to file
70. Compromise payment for failure to register. c. File in advance
a. 10,000.00
b. 20,000.00 82. Due date for percentage taxes.
c. 5,000.00 a. 20th day after end of month
b. 15th day after end of month
71. Compromise payment for failure to pay c. 10th day after end of month
annual registration.
a. 1,000.00 83. Fiscal due date for income tax of corporation
b. 2,000.00 or partnership.
c. 3,000.00 a. 20th day of the 4th month of the succeeding
year
72. Compromise payment for failure to display b. 15th day of the 4th month of the
certificate of registration. succeeding year
a. 1,000.00 c. 15th day of the 3th month of the succeeding
b. 2,000.00 year
c. 3,000.00
84. Fine on refusal to issue official receipts or
73. Compromise payment for failure to display invoices upon conviction.
poster "ask for receipt" a. 1,000.00 but not more than 20,000.00
a. 1,000.00 b. 1,000.00 but not more than 30,000.00
b. 2,000.00 c. 1,000.00 but not more than 50,000.00
c. 3,000.00
85. Compromise payment for failure to issue
74. Invoicing requirement for sale of goods. receipt for 1st offence.
a. Inspection paper a. 10,000.00
b. Receipt b. 20,000.00
c. Sales invoice c. 30,000.00

75. Invoicing requirement for sale of services or 86. Compromise payment for 2nd offense on
professional fees. the use of unregistered receipts
a. 10,000.00 98. Creditable withholding tax for habitually
b. 20,000.00 engage in business and selling price is over
c. 30,000.00 500,000. to 2 million.
a. 1.5%
87. Compromise payment for 1st offense on b. 5%
refusal :o issue receipt. c. 3%
a. 10,000.00
b. 30,000.00 99. Creditable withholding tax for habitually
c. 25,000.00 engage in business and selling price is below
500,000.00.
88. Years to preserve books after close of a. 1.5%
taxable year. b. 3%
a. 6 years c. 5%
b. 5 years
c. 3 years
100. Creditable withholding tax for not habitually
89. Books shall be audited and examined by engage in business.
independent CPA if gross receipts exceed. a. 6%
a. 150,000.00 b. 5%
b. 120,000.00 c. 4%
c. 160,000.00
101. Registration fee payment form.
90. Monthly remittance of income taxes a. BIR form 0605
withheld on compensation. b. BIR form 0606
a. 10th of the following month c. BIR form 0607
b. 20th of the following month
c. 5th of the following month 102. BIR form Certificate of registration.
91.Monthly remittance of income taxes withheld a. BIR form 0203
on compensation for November. b. BIR form 3203
a. 15th of December c. BIR form 2303
b. 15th of January
c. 15th of November 103. BIR form to apply for authority to print
receipts
92. Documentary stamp tax. a. BIR form 0606
a. 5th day of the following month b. BIR form 1906
b. 15th day of the following month c. BIR form 0601
c. 25th day of the following month
104. Exempt from withholding tax
93. Capital gain tax. compensation.
a. Within 10 days after execution a. Minimum wage earners
b. Within 20 days after execution b. Maximum wage earners
c. Within 30 days after execution c. Regular wage earners

94. Estate tax 105. Detect non filing of tax return and non
a. Within 120 days from death payment of taxes
b. Within 360 days from death a. BIR Integrated Tax System
c. Within 100 days from death b. Tax Integrated System
c. BIR computer system
95. Donors tax
a. Within 60 days from execution 106. Effectivity threshold amount of sales of
b. Within 30 days from execution residential lot, house for sale or lease of
c. Within 50 days from execution property.
a. RR 3-2012
96. Surcharges if it is done willfully and b. RR 4-2013
fraudulently. c. RR 5-2011
a. 50%
b. 20% 107. Created to oversee and monitor the
c. 10% implementation of this RA 9700.
a. Provincial Oversight Committee
97. Creditable withholding tax for habitually b. CARP Oversight Committee
engages in business and selling price is over c.CongressionalOversight Committee
2million.
a. 5% 108. Person who knowingly or willfully violates
b. 3% the provisions of R 9700 shall be punished by
c. 1% imprisonment.
a. One month to 3 years
b. Two month to 3 years
c. Three month to 3 years 117. In computing for the Property’s taxable
109. The forcible entry or illegal detainer by value or the assessed value, you must first
persons who are not qualified beneficiaries multiply the market value to the assessment
under RA 9700 to avail themselves of the rights level. Assessment level from Section 218 of
and benefits of the Agrarian Reform Program RA7160 in Metro Manila ON LANDS should be:
shall be penalized of imprisonment.
a. 4 to 6 years Statement 1. Assessment levels of Residential
b. 3 to 6 years should not exceed 20%.
c. 1 to 6 years Statement 2. Assessment levels of Agricultural
should not exceed 40%.
110. Dwelling place where a family resides is
classified as. a. Statement 1 is True and Statement 2 is False
a. Special Asset b. Statement 1 is False and Statement 2 is True
b. Ordinary Asset c. Both Statements are True
c. Capital Asset d. Both Statements are False

111 Who should pay for Real Property Tax? 118. In computing for the Property’s taxable
a. People who owns or whose names are on value or the assessed value, you must first
titles and certificate of ownership, whether multiply the market value to the assessment
the property is for residential or commercial level. Assessment level from Section 218 of
use. RA7160 in Metro Manila ON LANDS should be:
b. People who owns or whose names are on
agreements and SEC certificate, whether the Statement 1. Assessment levels of Commercial,
property is for residential or commercial use. Industrial, Mineral should not exceed 50%.
c. People who owns or whose names are on Statement 2. Assessment levels of Timberland
Deed of Absolute Sale and Statement of should not exceed 20%.
Account, whether the property is for residential
or commercial use. a. Statement 1 is True and Statement 2 is False
b. Statement 1 is False and Statement 2 is True
112. The Metro Manila rate for Real Property tax c. Both Statements are True
is. d. Both Statements are False
a. Not exceeding 1%
b. Not exceeding 2%
c. Not exceeding 3% 119. In computing for the Property’s taxable
value or the assessed value, you must first
113. Amount of real property tax in the province. multiply the market value to the assessment
a. Not exceeding 1% level. Assessment level from Section 218 of
b. Not exceeding 2% RA7160 in Metro Manila ON BUILDINGS and
c. Not exceeding 3% Other Structures should be:

114. Real property tax is based on: Statement 1. Assessment levels of Residential
a. Zonal value of the property with a Fair Market Value of
b. Assessed value of the property
c. Market value of the property Fair Value Not Over Assessment
d. Appraised Value of the property Over Levels
P175,000 0%
115. Aside from basic real property tax, local
governments also charge additional tax for P175,000 P300,000 10%
Special Education Fund. A _______ is levied on P300,000 P500,000 20%
the assessed value of the real property and P500,000 P750,000 25%
proceeds of which go to the budget of local P750,000 P1,000,000 30%
schools. P1,000,000 P2,000,000 35%
a. 2% P2,000,000 P5,000,000 40%
b. 1% P5,000,000 P10,000,00 50%
c. 3% 0
d. 5% P10,000,000 60%

116. If properties become idle or no activities,

Statement 2. Assessment levels of Assessment
the government also charges a maximum of
levels of Agricultural with a Fair Market Value of
_____% of the assessed value in addition to the
basic real property tax. Fair Value Not Over Assessment
a. 2% Over Levels
b. 1% P300,000 25%
c. 3% P300,000 P500,000 30%
d. 5% P500,000 P750,000 35%
P750,000 P1,000,000 40%
P1,000,000 P2,000,000 45%
P2,000,000 50% c. Both Statements are True
d. Both Statements are False

a. Statement 1 is True and Statement 2 is False 123. In 1992, Alden Ricky bought a residential
b. Statement 1 is False and Statement 2 is True house and lot in Magallanes Village, Makati City
c. Both Statements are True for P50,000,000 with a market value of
d. Both Statements are False 5,000,000 for land and 3,000,000 for the building
based on tax declaration, how much do you
*This may not the actual way on how they ask think is his real property tax assessment?
question but for the purpose of review, we better a. P50,000
to put it this way for computations of RPT. b. P44,000
c. P52,000
d. P53,000
120. In computing for the Property’s taxable
value or the assessed value, you must first
multiply the market value to the assessment 124. Vice Gondol bought a condominium
level. Assessment level from Section 218 of property in Mall of Asia, Pasay City for
RA7160 in Metro Manila ON MACHINERIES P5,000,000 with a market value of 900,000
should be: based on his tax declaration. On 2019 the Pasay
LGU implemented a new ordinance adjusting
Statement 1. Assessment levels of Residential the assessment level as follows:
should not exceed 50%
Fair Not Over RA 7160 Pasay
Statement 2. Assessment levels of Agricultural Value Assessme LGU 2019
should not exceed 40% Over nt Levels Assessme
nt Level
a. Statement 1 is True and Statement 2 is False P750,000 P1,000,0 30% 60%
b. Statement 1 is False and Statement 2 is True 00
c. Both Statements are True P1,000,0 P2,000,0 35% 65%
d. Both Statements are False 00 00
P2,000,0 P5,000,0 40% 70%
121. In computing for the Property’s taxable 00 00
value or the assessed value, you must first
multiply the market value to the assessment
What is the assessment level of Mr. Vice
level. Assessment level from Section 218 of
Gondol?
RA7160 in Metro Manila ON MACHINERIES
a. 30%
should be:
b. 60%
c. 35%
Statement 1. Assessment levels of Commercial
d. 40%
and Industrial should not exceed 80%

Statement 2. Assessment levels of Commercial

125. As a continuation of the previous problem:
should not exceed 40%
How much is the estimated real property tax of
Mr. Gondol?
a. Statement 1 is True and Statement 2 is
a. P11,800
False
b. P10,800
b. Statement 1 is False and Statement 2 is True
c. P13,800
c. Both Statements are True
d. P12,800
d. Both Statements are False
126. Under TRAIN Law, lawful heirs and
122. In computing for the Property’s taxable
beneficiaries for estate tax would only be tax at
value or the assessed value, you must first
a. 8%
multiply the market value to the assessment
b. 10%
level. Assessment level from Section 218 of
c. 6%
RA7160 in Metro Manila ON SPECIAL
d. 7%
CLASSES should be:
127. Under TRAIN Law, lawful heirs and
Statement 1. Assessment levels of (CSH)
beneficiaries for estate tax would only be tax at
Cultural, Scientific and Hospital should not
a. 8%
exceed 15%.
b. 10%
c. 6%
Statement 2. Assessment levels of Local water
d. 7%
districts, government owned corporations should
not exceed 10%
128. When did President Rodrigo Duterte
signed into law the Package 1 of the
a. Statement 1 is True and Statement 2 is False
Comprehensive Tax Reform Progran also
b. Statement 1 is False and Statement 2 is True
known as TRAIN Law which took effect on 135. The Documentary Stamp Tax under the
January 1, 2018? TRAIN law for Deed of Sale, Conveyances, and
Donation of Real Property Documents is
a. December 19, 2017 a. P15.00 for 1st P1,000; P15.00 for each next
b. December 18, 2017 P1,000
c. December 17, 2017 b. 1.% of value
d. December 16, 2017 c. 0.50 of value
d. 2% of value
129. It aims to make the Philippine Tax System
simpler, fairer, and more efficient to promote
investments, create jobs, and reduce poverty.
a. RA 11291
b. RA 10963
c. RA 7160
d. RA 10051

130. Mr. Zai, a self employed real estate broker

earned a Gross Sales Commission of
P2,900,000 for year 2018, what is the tax rate of
Mr. Zai?
a. Regular Personal Income Tax rate (PIT)
b. 8% of Gross Sales Receipts in Excess of
P250,000
c. Either Option 1: Regular PIT rates or
Option 2: 8% of gross sales/receipts in
excess of P250,000
d. Exempt

131. In the New Train Law, the amount of gross

value of estate provided in estate tax returns
that requires a supported statement duly
certified by a CPA is _________
a. from P2 million to P5 million
b. from P2 million to P7 million
c. from P2 million to P10 million
d. from P2 million to P12 million

132. Under the New Train Law, the filing of

estate tax return extended to
________________ from the decedent’s death.
a. 6 months
b. 1 year
c. 8 months
d. 3 months

133. In 2019, Yorme Kois a Filipino citizen

donated a residential condominium property
amounting to P6,000,000 located in Ayala
Avenue Makati City to his brother. How much is
the donor’s tax ?
a. Exempt
b. 8% of the property
c. Computed by old tax schedule of P204,000 +
10% over P3M
d. 6% of the property

134. Mr. Willy Show, a Filipino citizen donated a

residential condominium property amounting to
P5,000,000 located in Pasig City to Mr. Jhong
Dodong (stranger). How much is the donor’s
tax ?
a. Exempt
b. 30% of the net gifts
c. Computed by old tax schedule of P204,000 +
10% over P3M
d. 6% of the property
1. A house and lot, with a land area of 400 C. P322,787.71
square meters sold at P2,500,000.00. Per tax D. P323,787.71
declaration , fair market value of the house is 9. Refer to Item No.6, the documentary stamps
P1M , and the lot is P1.2M. The zonal value of tax is:
the lot is P3,000.00 per square meter. The sale A. P80,446.93
is subject to capital gains tax. How much is the B. P71,446.93
tax base? C. P69,446.93
A. P2.0M D. P68,571.43
B. P2.2M
C. P2.5M 10. Refer to Item No.6, the gross commission of
D. P3.0M professional fee to be received by the broker is:
A. P137,142.85
2. Refer to problem 1, how much is the capital B. P158,893.85
gains tax? C. P159,893.85
A. P120,000.00 D. P160,893.85
B. P132,000.00
C. P150,000.00 11. A corporation is developing a 10-hectare
D. P180,000.00 rawland purchased at P400.00 per sqm.
Development cost is estimated at P300.00 per
3. Refer to problem 1 , how much is the square meter based on the gross area.
documentary stamps tax.? Marketing exclusive of advertising and broker’s
A. P30,000.00 commission is 15% of selling price. If the
B. P33,000.00 company desires a gross profit of 30% of the
C. P37,500.00 selling price, what should be the minimum
D. P45,000.00 selling price per square meter of the subdivision
lots assuming that saleable area is 60% of gross
4. An industrial land was sold by two brokers at area.
P12M with 3% professional fee. The brokers A. P2,121.21
agreed that the listing broker shall get 45% of B. P2,000.21
the commission. What will be the share of the C. P1,918.18
listing broker? D. P1,818.18
A. P160,000.00
B. P180,000.00 12. Mr. Salon pays monthly amortization of
C. P198,000.00 P54,000.00 for a parcel of land. The
D. P162,000.00 amortization factor for 5 years at 21% interest
5. Mr and Mrs. Reyes bought a new house and per annum is 0.02705. if he paid a down
lot in Cordova, Cebu for P3.0M. They paid payment of 25% of the contract price, the
P800,000.00 in cash and were able to secure a principal obligation on which the monthly
bank loan for the difference payable for 15 years amortization is based will be?
at 12%. How much will they have to pay monthly A. P2,000,000.00
for their house? Amortization factor = B. P1,996,303.00
0.012001681). C. P1,896,303.00
A. P25,804.03 D. P1,896,303.00
B. P26,403.03 13. Refer to item No. 21, the contract price is?
C. P27,804.03 A. P2,661,737.00
D. P28,804.03 B. P2,616,737.00
C. P2,600,000.00
6. Mr. Enguito a licensed real estate broker, D. P2,500,000.00
obtained this net listing: a residential lot with an 14. Refer to Item No. 21, the amount of
area of 400 square meters for sale at downpayment is?
P10,000.00 / sqm. She therefore has to sell the A. P663,443.00
property at a price that would be inclusive of the B. P665,434.00
capital gains tax, documentary stamps and the C. P600,000.00
broker’s commission of 5%. The net selling price D. P500,000.00
is: 15. A commercial building has the following
A. P4,000,000.00 measurements: Ground floor 30 meters by 25
B. P4,571,428.57 meters, mezzanine is 30% smaller than the
C. P4,800,000.00 ground floor: 2nd floor is 35 square meters
D. P5,363,128.49 smaller than the ground floor, 3rd floor is 1/4
7. Refer to Item No. 6, the gross selling price is: bigger than the mezzanine. The total floor area
A.P4,263,128.49 of the building is:
B. P4,571,428.57 A. 2,469.25 sqms
C. P4,800,000.00 B. 2,596.25 sqms
D. P5,363,128.49 C. 2,646.25 sqms
8. Refer to Item No.6, the capital gains tax is : D. 2,796.25 sqms
A. P274,285.71
B. P321,787.71
 b. P100,000
16. Hermogila bought a subdivision lot c. P250,000
consisting of 1,250 square meters at P12,000.00
per square meter. She made a downpayment of
5. In the TRAIN LAW, for taxable income
30% and the balance was payable in equal
monthly installments including interest at 25% over P250,000 but not over P400,000 the
per annum. Assuming she made prompt monthly tax shall be __________________.
payments, how much interest did she pay for the a. 20% of the excess over P250,000.
6-year period? The amortization factor b. 15% of the excess over P250,000
is .028768 c. 25 % of the excess over P250,000.
A. Total Interest paid = P6,302,064,.00
B. Total Interest paid = P7,623,840.00
6. In the TRAIN LAW, for taxable income
C. Total Interest paid = P9,123,840.00
D. Total Interest paid = P11,248,608.00 over P400,000 but not over P800,000 the
tax shall be __________________.
17. Magdadaro bought a house and lot and paid a. P30,000 + 25% of the excess over
P50,000.00 reservation and the full down P400,000.
payment of 15% in full within 60 days of the total b. P30,000 + 20 % of the excess over
contract price of P3M . How much will she has to P400,000.
pay in 60 days?
c. P30,000 + 30% of the excess over
A. P450,000.00
B. P400,000.00 P400,000.
C. P350,000.00
7. In the TRAIN LAW, for taxable income
TRAIN LAW EFFECTS IN REAL ESTATE over P800,000 but not over P2,000,000
the tax shall be __________________.
1. Tax Reform for Acceleration and a. P130,000 + 30% of the excess over
Inclusion (TRAIN) Law is under Republic P800,000.
Act No.? b. P130,000 + 32 % of the excess over
a. RA 11965 P800,000.
b.RA 10963 c. P130,000 + 35% of the excess over
c. RA 10593 P800,000.

2. Train Law will take effect on. 8. Who among this individual is not
a. January 1, 2018 required to use the graduated income tax
b.January 1, 2019 rates.
c. January 1, 2017 a. Employees
b. Self-employed individuals, including
3. Declaration of Policy does not includes professionals, whose gross sales or
a. To enhance the progressivity of the receipts and non-operating income
tax system through the rationalization exceed P3,000,000
of the Philippine internal revenue tax c. Mixed income earners whose gross
system, thereby promoting sales or gross receipts and non-
sustainable and inclusive economic operating income exceed
growth. P3,000,000.00
b. To provide, as much as possible d. Individyals whose gross sales or
equitable relief to a greater number of receipsm regardless of amount are
taxpayers and their families in order to subject to percentage tax
improve levels of disposable income e. Partners in general professional
and increase economic activity. partnerships
c. To ensure that the government is able f. Individuals enjoying tax excemption
to provide for the needs of those g. None of the above
under its jurisdiction and care through
the provision for better infrastructure, 9. How much is the maximum non-taxable
health, jobs, and social protection for 13th month pay and other benefits?
the people. a. P82,000
d. None of the above. b. P90,000
c. P100,000
4. In the TRAIN LAW, 0% tax should be for
individuals with taxable income not 10. The removal of tax exemptions of PCSO
over______. and LOTTO Winnings exceeding P10,000
a. P10,000 benefits is
 a. P10,000 or less = tax excempt; Employees, Self-Employed and
More then P10,000 will be subject Corporations for income tax return will be
to final tax 20%. a. 4 pages
b. P100,00 or less = tax exempt; More b. 8 pages
then P100,000 will be subject to final c. 12 pages
tax 20%
c. Subject to final tax of 20% 19. Under TRAIN LAW, Creditable Witholding
Tax will have same deadline but
11. Under the TRAIN LAW, how much is the ____________ is deleted.
Basic Personal Exemption? a. Requirements
a. P50,000 b. Statements
b. P100,000 c. Proviso
c. None
12. Under the TRAIN LAW, how much is the 20. What form to use for Creditable
additional exemption? Withholding Tax for the TRAIN LAW?
a. None a. 1601-E
b. P25,000 for each qualified dependent b. 0619E for the 1st 2 months of every
maximum of 4 qualified dependents quarter,, 1601EQ (with Alphalist
c. P150,000 Attachments) for the quarter
13. Under the TRAIN LAW, how much is the c. 2303
ecemption for Estates and Trust?
a. P20,000 21. Changes in Threshold Amounts for Value
b. None Added Tax for VAT Threshold Amount
c. P30,000 a. P1,919,500 to P3,000,000
b. P1,919,500 to P2,500,00
14. How much is the increase in tax rates for c. P1,919,500 to P3,500,000
Fringe Benefits received by Managerial or
Supervisory Employees? 22. Under the Train LAW, VAT exemption for
a. From 32% to 35% Sale of Residential Lot will be
b. From 32% to 33% __________________
c. From 32% to 36% a. P1,500,000
b. P1,919,500
15. Train Law change the interest income c. P3,199,200
under the expanded foreign currency
deposit system to: 23. Under the Train LAW, VAT exemption for
a. From 7.5% to 15% Sale of House and Lot and other
b. From 7.5% to 10% Residential Dwellings like condominiums
c. From 7.5% to 20% will be __________________
a. P3,199,200
16. Under the TRAIN LAW, how much is the b. P2,500,000
increase in De Minimis Benefits c. P3,000,000
a. Medical Cash Allowance to
Dependent of Employees from P750 24. Under the Train LAW, VAT exemption for
per sem to P1500 per sem Lease of Residential Unit will be
b. Rice Subsidy from P1500 to P2000 __________________
c. Uniform and Clothing Allowance from a. P12,800 per month
P5000 per annum to P6000 per b. P15,000 per month
annum c. P20,000 per month
d. All of the Above
25. ESTATE Tax Rate under the TRAIN LAW
17. Under the TRAIN LAW, Income tax will be ___________________________.
deadlines for individuals for 1st quarter will a. 6% of the Net Estate (Gross Estate
be less Allowable Deductions)
a. April 15 b. 8% of the Net Estate (Gross Estate
b. May 15 less Allowable Deductions)
c. August 15 c. Same as bebfore
Ans. A
18. Under the TRAIN LAW, maximum
26. How much is the allowed deductions from
number of pages for BIR FORM for
gross estate under TRAIN LAW.
 a. 5% of Gross Estate less than 6 years and 1 day nor more than 21
b. P200,000 years referred as
c. None a. Penalty
b. Penal Provision
c. Imprisonment
27. Under TRAIN LAW, Standard deduction
for Gross Estate is 7. What is the maximum loan term
______________________. a. 20 years
a. P1,000,000 b. 30 years
b. P5,000,000 c. 50 years
c. P2,000,000
8. The shares of stock of the REIT must be
d. registered with the Commission and listed in
accordance with the rules of the Exchange.
28. Under TRAIN LAW, Filing and Payment a. Nationality Requirement
Deadline for Estate Tax b. Investment in the REIT
a. Wihtin 6 months from death b. Registration and Listing
b. Within 1 Year from Death
c. Within 2 years from Death 9. Government credit agencies that provide
loans directly for farmers and home mortgagors.
a.Government-sponsored enterprises
29. DONOR’s Tax Rate under the TRAIN b. Finance companies
LAWwillbe c. Securities firm
___________________________.
a. 6% of the total gifts in excess of 10. The change in revenue that is generated by
P250,000 made during calendar an additional unit of sales .
a. Marginal revenue
year.
b. Total revenue
b. 8% of the total gifts in excess of c. Average revenue
P250,000 made during calendar year.
c. Same as before 11. If demand rises ,the demand curve shifts to
the .
a. Center
REAL ESTATE FINANCE AND ECONOMICS b. Left
c. Right
1. REIT distribute at least ________ of its
distributable income as dividend. 12. The movement of prices will tend to go up
a. 80% because of the higher demand.
b. 90% a. Public Market
c. 50% b. Sellers market
c. Buyers Market
2. To be deducted from the loan proceeds of 13. Real estate Economics tries to describe,
pag-ibig loan explain, and predict patterns of
a. 4,000.00 a. prices, supply, and demand
b. 3,000.00 b. prices, income , and demand
c. 2,000.00 c. prices, consumer, and demand

3. What is the interest rate if the pag-ibig loan 14. Basically a result of the interplay of supply
amount is over P2M-P3.0M ? and demand of a certain product, such as real
a. 11.5% estate housing.
b. 12% a. Price
c. 10% b. Area
c. Construction
4. We mean the ultimate economic effect of a
tax on the real incomes of producers and 15. A key determinant of demand
consumers by a. Average Income
a. Incidence b. Special Influences
b. Choice c. Size of the market
c. Random
16. Important kinds of market structures are
5. Percentage change in quantity demanded a. Monopolistic competition and perfect
greater than percentage change in price. competiton
a. Inelastic demand b. Monopoly, oligopoly, monopolistic and
b. Elastic demand perfect competition .
c. Unit elastic demand c. oligopoly, monopolistic and perfect
competition
6. In REIT, A fine of not less than P200,000 nor
more than P5,000,000.00 or imprisonment of not
17. Take deposits and make loans; they are b. Investible Funds
what most people think of as bank. c. Investors fund
a. Pensions Funds
b. Insurance Company 28. Means a corporation that directly or
c. Depository Institutions indirectly, through one or more intermediaries, is
controlled by, or is under the common control of
18. Income payment to a REIT shall be subject another corporation, which thereby becomes its
to a lower creditable withholding tax of 1%. parent corporation.
a. Creditable Withholding Tax a. Affiliate
b. Income Taxation of REIT b. Subsidiary
c. Transfer of Real Property c. intermediary

19. Failure to pay 3 consecutive monthly 29. A very important formula for the computation
amortizations and/or membership contributions. involving real estate financing is:
a. Default MONTHLY AMORTIZATION [ M A ] = Principal
b. Redemption to be financed x Amortization Factor
c. Inflation a. False
b. True
20. Must have at least 2 years repayment history c. Both A and B
with current bank/institution
a. Insurance 30. Refinancing must have at least 2 years
b. Capitalization repayment history with current bank/institution
c. Refinancing a. True
b. False ,at least 3 yrs
21. Refinancing must have how many years c. False , at least 4 yrs
for repayment history with current
bank/institution 31. When demand is price inelastic ,a price
a. at least half year decrease and makes the total revenue
b. at least 2 years a. Reduces
c. at least 4 years b. Unchanged
c. Increases
22. The percentage change in quantity supplied
divided by the percentage change in price . 32. The practice of charging different prices for
a. Price elasticity of supply the same service to different customers
b. Price elasticity a. Price Discrimination
c. Price elasticity of demand b. Price
c. Price Elasticity
23. A tax is shifted forward to consumers if
the demand is inelastic relative to supply 33. In pag-ibig, the six months interim insurance
a. The statement is correct and 2k processing fee is referred to as .
b. The statement is not true a. Deductions on final loan releases
c. Statement A & B is correct b. Deductions on the first loan release
c. Deductions on prospective loan releases
24. Refers to the flow of wages ^interest
payments dividends ,and other things of value 34. A financial institution that include brokers,
accruing during a period of time . investment banks, under writers and mutual fund
a. Status companies.
b. Salary a. Pension funds
c. Income b. Securities firms
c. Saving banks

24. Another element which affects the 35. Issue stocks and bonds to the corporate
movement of real estate customers, trade them, and advise costumers.
a. statement b and c a. Mutual fund companies
b. the availability financing, both for the b. Real estate
production side or the developers c. Brokers and investment banks
c. the demand side which is the buying market
36. The structure of the financial industry that
25. Involves generally the acquisition of property includes insurance companies, securities firms,
through loan financing sources and mutual fund companies and pension funds.
a. Real estate economics a. Financial Institutions
b. Real Estate Service Practice b. Depository Institutions
c. Real Estate Financing c. Nondepository institutions

27. Refer to funds of the REIT that can be 37. Which of the statement is not correct
placed in investment vehicles other than income a. Not all securities firms are very much in
generating real estate the business of producing information
a. Investment fund
b. Finance companies are in the lending a. 65
business. b. 70
c. Brokers also provide loans to the customers c. 75
49. Refers to a professional administrator of real
properties who is engaged by the REIT to
38. If supply falls ,the supply curve shifts to provide property management services and
the left, and . lease management services.
a. Price falls and quantity goes down a. Property owner
b. Price rises and quantity goes down b. Property Manager
c. Price rises and quantity goes down c. Property administrator

39. The price at which quantity demanded 50. Refinancing loan 5% of the loan amount
equals quantity supplied. retained to ensure cancellation of mortgage/s
a. Demand Curve prior to PAG-IBIG Fund is referred to
b. Market equilibrium a. Investment
c. Shifts in Supply b. Real Interest Rate
c. Retail Accounts
40. The application of economic techniques
to real estate markets. 51. Which of the statement is not true
a. Real estate economics a. Borrower will start the 3 construction if
b. Real Estate Financing the total cost is lower than the approval loan
c. Real Estate Service Practice b. Borrower will start the 3 construction if the
41. Simply means the effect of one aspect of total cost is higher than the approval loan
the economy with the other economic activities. c. Borrower to request inspection prior to every
a. Multiplier effect of Real estate release of loan proceeds
b. Binding effect 52. It is said that for every PI million invested in
c. Repulsion effect housing it is translated to P16.6 million of
economic housing activity in the country
42. The pag-ibig maximum loan amount. a. True
a. P3 Million b. Maybe
b. PI Million c. False
c. P6 Million
1. Pag-ibig loan charges and deductions
43. Pagibig Principal borrower's age shall not processing fee.
exceed . a. P2,000.00
a. 70 years old at date of loan maturity b. P3,000.00
b. 48 years old at date of loan maturity c. P4,000.00
c. 55 years old at date of loan maturity
44. Whether or not the country provides equal 54. Based on the Pag-ibig membership
health care for all its residents ,health care must Contribution if the loan entitlement over PI.7 M
be rationed because . to 1.8 M ,what will be the monthly contribution ?
a. Supply is available a. 700
b. Supply is limited b. 950
c. Public goods is needed c. 850
45. Takes large individual risks and spreads 55. Retail and Developer Accounts with
them so broadly that they become acceptable to Transferred Titles Under Borrower's Name
a large number of individuals (REM Accounts) referred as
a. Banks a. Effects of loan
b. Loans b. Effects of sales
c. Insurance c. Effects of default
46. In refinancing latest one year amortization 2. To be paid upon filing of pag-ibig Housing
must reflect default is true Loan Application, non-refundable
a. Yes a. 1,000.00
b. No ,must not reflect default b. 10,000.00
c. A & B is correct c. 2,000.00
46. Number of contribution inorder that a 57. Is the largest insurance program
borrower elible for pag-ibig loan. a. Health care
a. 24 b. Social
b. 12 c. Educational
c. 48
58. A REIT that owns land located in the
48. Not more than years old at the date of Philippines must comply with the foreign
loan application and must be insurable; ownership limitations imposed under the
provided further, that he is not more than Philippine law.
seventy (70) years old at loan maturity. a. Registration and Listing
b. Nationality Requirement a. One year prepayment insurances
c. Investment in the REIT b. Interim Mortgage Redemption Insurance
59. A REIT must have a minimum paid-up c. Retail Accounts
capital of P300,000,000.00.
a. Finance 69. Is a stock corporation established in
b. Profit accordance with the Corporation Code of the
c. Capitalization Philippines and the rules and regulations
promulgated by the Commission principally for
60. The spirit of unity, harmony, ramaradarip, the purpose of owning income-generating real
cooperation and professional relationship among estate assets.
the practitioners is essential, and shall be a. Nationality Requirement
promoted under . b. Investment in the REIT
a. The principle of solidarity c. Real Estate Investment Trust
b. Standards of the practice
c. Government authorities 70. Properties with "Rights" instead of "Title"
61. Net revenues, or the difference between as proof of ownership.
total sales and total costs. a. NOT ALLOWED for Pag-IBIG Housing
a. Profits Loan
b. Price b. Maybe ALLOWED for Pag-IBIG Housing
c. Demand Loan
c. ALLOWED for Pag-IBIG Housing Loan
62. In the case where there are more buyers
than sellers, then it is considered a seller's 71. Real Estate Investment Trust Act of 2009
market as there are fewer real properties (R.A. no. 9856)
available vis-a-vis a higher demand for it. In this a. An act providing the legal framework for
case, real estate investment trust and for other
a. the movement of supply will tend to go up purposes
because of the higher demand b. An act Providing areas and facilities
b. the movement of prices will tend to go c. An act for maintenance and insurance
down because of the higher demand. policies,including power to enforce the provision
c. the movement of prices will tend to go of declarations of restrictions
up because or' the higher demand 72. Use as an instrument to help finance and
63. The price of real estate has a tendency to develop infrastructure projects
go down in view of the excess in supply vs. the a. Capital Market
actual demand of the market, is normally b. Economic Market
referred to as c. Community
a. Wet Market
b. Suppliers Market 73. Pag-ibig monthly repayment shall not
c. Buyers Market exceed of the borrowers gross monthly
64. Penalty of the amount due for everyday income for loans not exceeding PI,250,000.
of delay of pag-ibig loan. a. 25%
a. 1/20 of 2% b. 30%
b. 1/20 of 1% c. 35%
c. 1/20 of 5%
74. Minimum total stock public ownership of
65. The primary asset of modern commercial shareholders in REIT
banks, accounting for nearly two thirds of a. 50,000 shares
assets. b. 1,000 shares
a. Securities c. 5,000 shares
b. Loans
c. Funds
75. If a corporation builds a factory, it will
66. Which statement is true employ construction workers and their suppliers
a. Maximum of three qualified pag ibig as well as those who work in the factory. The
members may be tacked into a single loan statement best explains .
b. Maximum of two qualified pag ibig a. an effect in Society
members may be tacked into a single loan b. an effect in Economics
c. Maximum of five qualified pag ibig c. an effect in Macroeconomics
members may be tacked into a single loan
67. Loans over P400 to P3M maybe subject to 76. Refers to the total quantity of goods and
repricing services that the nations businesses willingly
a. Every 3 years but not to exceed 2% from produce and sell in the given period.
the original rate a. Investment
b. Every 2 years but not to exceed 2% from b. Consumption
the original rate c. Aggregate Supply
c. Every 4 years but not to exceed 2% from
the original rate
68. To be deducted from the loan proceeds
77. Which occurs because a good becomes c. Decrease price and decrease quantity
relatively more expensive when its price rises? demand
a. Substitution effect
b. Market demand 86. Quantity supplied generally responds
c. Income effect positively to price ,so the supply curve is .
a. Downward-sloping
78. The earnings in the market economy are b. Upward-sloping
distributed to the owners of the economy7s c. No slope
factors of production in the form of: 87. Listed are the different depository institutions
a. Wages ,profit, rent, and interest except
b. National income corporate profits and rental a. Saving banks
income b. Commercial banks
c. National income salaries and labor income c. Insurance companies

88. Real estate financing involves generally the

79. Is by definition equal to price times quantity acquisition of property through loan financing
(PxQ) sources, which may be sourced from the
a. Total Sales following,except
b. Total Revenue a. Bank Financing and lending companies
c. Total Income b. Pilfering from Relatives/Friends
c. Assumption of Loan/Mortgages and
80. Provides and sets of a domino effect on Government Financing
other economic activities which can be referred
to the "multiplier effect of real estate". 89. Deductions on the first loan release:
a. The housing or real estate sector a. 6 months interim insurance and 2k
b. Real Estate Finance processing fee
c. Real Estate Economics b. 2 months interim insurance and 2k processing
fee
81. Which of the following does not c. 3 months interim insurance and 2k processing
describe the loans purpose fee
A. Analyzes financial and economic 90. The 1st release of loan is based on lot
conditions ,both domestic and international value or 40% of the approved loan whichever is
b. Refinancing of an existing mortgage, lower
specifically a lot loan, with house construction a. Incorrect
c. Purchase of a residential house and lot, b. Correct
townhouse or condominium unit c. Statement a and B
82. Which of the following statement is not true
about policy declaration 91. When the price of a commodity is raised,
a. Democratize wealth by broadening the buyers tend to buy less of commodity.
participation of Filipinos in the ownership of real a. Law of Supply
estate in the Philippines b. Law of Demand
b. Promote the development of the capital c. Law of downward -sloping demand
market;
c. Use the capital market as an instrument
to help finance only
83. Basic borrower eligibility requirements 92. When there are changes in factors other
a. Not more than 65 years old upon filing, not than a good's own price which affect the quantity
more than 80 years old upon loan maturity purchased, we call these changes
b. Not more than 65 years old upon filing, a. Shifts in Supply
not more than 70 years old upon loan b. Shifts in Demand
maturity c. Shifts in Income
c. more than 65 years old upon filing, not 93. Interim interest and advance one year
more than 70 years old upon loan maturity insurances.
a. Deductions on final loan releases
84. Shifts in the supply and demand curves b. Deductions on first loan releases
change the . c. Deductions on second loan releases
a. Equilibrium price and quantity
b. Equilibrium price and demand 94. NOT ALLOWED for Pag-IBIG Housing Loan
c. Equilibrium price and supply
a. Less than 28 sqm. Lot area
85. An increased in supply,which shifts the b. Less than 30 sqm. Lot area
supply curve to the right ,will c. Less than 50 sqm. Lot area
a. Decrease price and increase quantity
demanded 95. Married individuals not legally separated
b. Increase price and increase quantity and cannot secure marital consent or Special
demanded Power of Attorney (SPA) from spouse is allowed
for Pag ibig housing.
a. No 106. Based on Pag-IBIG Membership
b. Yes Contribution if you have loan entitlement up to
c. Maybe 500,000 ,how much is the Monthly Contribution?
a. 200
96. Revenues will increase when price b. 350
a. Decreases c. 250
b. Increases
c. Unchanged 107. The sale or transfer of real property to
REITs, which includes the sale or transfer of any
97. The pag-big ratio of the loan amount to the and all security interest thereto, shall be subject
appraisal value of the collateral up to to 50% of the applicable DST.
1,250,000.00 a. True
a. 80% b. False
b. 90% c. None of the above
c. 50%
108. The largest source of wages, rents and
98. REIT act of 2009 interest payment at every level form
a. RA 9856 a. International income
b. RA 9756 b. Bank
c. RA 9586 c. Government

99. The loan amount retained to ensure 109. It tries to describe, explain, and predict
cancellation of mortgage/s prior to PAG-IBIG patterns of prices, demand and supply
Fund. a. Real Estate economics
a. 3% b. Real Estate Market Economy
b. 2% c. Real Estate
c. 5%
110. The equilibrium price is also called .
100. Income payment to a REIT shall be subject a. Market -clearing price
to a lower creditable withholding tax of b. Equilibrium cost
a. 1% c. Increased supply
b. 0.5%
c. 25% ===========================
REAL ESTATE INVESTMENT TRUST
101. Loan charges and deduction Processing 111. It is an act known as Real Estate
Fee of pag-ibig Investment Act.
a. P3,000.00
b. PI,000.00 Republic Act No. 9856
c. P2,000.00

102. To carry out the purposes of this Act the 112. Refers to a lawyer, Accountant, Auditor,
Commission shall retain and use 50% of all fees financial, or business consultant, and other
paid to it, relative to the establishment of REITs persons rendering professional advisory
and the registration of their securities to annual services to the REIT.
budget.
a. Use of Registration Fees Advisor
b. Registration
c. Transfer of Real Property 113. The person engaged by the REIT to
perform certain functions.
103. Loan purpose is Refinancing of an existing
mortgage with home improvement
a. Yes Fund Manager
b. No
c. Maybe 114. Means instruments or investments that are
highly liquid and marketable and are considered
104. For something to have value, it must first good as cash that has passed the accreditation
have . process of the Fund manager.
a. Scarce
b. Utility Cash Equivalent Items
c. Demand
115. Refers to real property which is held for the
105. Even if a thing has utility, it will not have purpose of generating a regular stream of
value if it is overabundant. income like: rentals, toll fees, user's fees
a. Market
b. Demand Income Generating Real Estate
c. Scarcity
116. Funds of the REIT that can be placed in
investment vehicles other than income- 3. Comprehensive Agrarian Reform Law was
generating real estate. signed.
a. July 21,1990
Investible Funds b. June 10, 1988
c. August 8,1988
117. The owner of investor securities
5. Philippine state policy that ensures and
Investor promotes welfare of landless farmers and farm
workers.
118. Shares of stock issued by a REIT or a. Voluntary Sell
derivatives thereof. b. Homestead
c. CARP
Investor Securities
5. The lead implementing agency of CARP
119. Means the Articles of Incorporation and By- a. Landbank
laws of a REIT b. DAR
c. DILG
Constitutive Documents
6. Green color in the DAR logo stands for.
110. An Individual citizen of the Philippines who a. Agriculture
is working abroad including one who retained or b. Life and Vitality
re-acquired his/her Philippine citizenship under c. Fertility and Productivity

Overseas Filipino Investor 7. Refer to natural person whose primary

111. Citizenship retention and Re-acquisition Act livelihood is the cultivation of land.
of 2003. a. Farmer
b. Gardener
RA#9225 c. Laborer

112. Refers to the net income as adjusted for 8. Women who are engaged directly or indirectly
unrealized gains and losses/expenses and in farming and/or fishing as their source of
Impairment losses and other items in livelihood, whether paid or unpaid, regular or
accordance with internationally accepted seasonal.
accounting standards. a. Urban women
b. Rural women
Distributable Income c. Laborer women

9. Award limit to farmer under PD 27 if the land

113. REIT Distribution of Dividends to is not irrigated.
shareholders a. 5 hectare
b. 3 hectare
Annually c. 4 hectare

114. The minimum paid - up capital of 10. Farmer's amortization under PD 6657 for
corporation payment of land.
a. 30 years
300,000,000 ( 300M) b. 25 years
c. 15 years
115. Minimum Public Ownership in the REIT.
11. Real property used in trade or business is
1,000 public shareholders classified as.
a. Business asset
b. Capital asset
REAL ESTATE LAWS TAXATION c. Ordinary asset

1. Land covered by the Agrarian Reform Code 12. The highest price in terms of money which a
except. property can command if exposed for sale in the
a. Old Settlements open market.
b. Tenanted Areas a. Fair Market Value
c. New Areas b. Market Value
c. Best Value
2. The slow pace of agrarian reform
implementation is due to. 13. Percentage of fair market value at which the
a. Social will assessed value is set.
b. Political will a. Base level
c. Economic will b. Percent level
c. Assessed level
25. Months required to build new house to avail
14. The fair market value of real property exemption from capital gain tax
multiplied by assessment level. It is synonymous a. 18 months
to taxable value. b. 24 months
a. Assessment c. 36 months
b. Assessed Value
c. Tax Assessment 26. Gross selling price of residential lot subject
to vat.
15. Percentage of assessed value at which the a. Exceeding 1,919,500.00
realty tax is arrived at. b. 1,900,000.00
a. Tax Rate c. 3,000,000.00
b. Assess rate
c. Value rate 27. Gross selling price of of other residential
dwelling subject to vat.
16. The use to which the property is principally a. Exceeding 3,199,200.00
or predominantly devoted. b. 1,919,000.00
a. Actual use c. 3,000,000.00
b. Principal use
c. Primary use 28. Under TRAIN Law, Lease of residential
17. This is a kind of tax levied by the local units with a monthly rental per unit subject in
government on properties and should be paid by order to be exempted from vat.
property owners. a. Below 10,000
a. Value Added Tax b. Below 10,800
b. Income Tax c. Below 12,800
c. Real Property Tax d. Below 15,000
d. Donor’s Tax
29. CARPER signed into law
18. Special education fund tax a. August 5, 2005
a. 1% b. August 7, 2009
b. 2% c. July 21,19888
c. 3%
30. Letter informing a landowner that his/her
19. Discount if payment is made in advance. land is covered by CARP.
a. 20% a. Notice of Coverage
b. 30% b. Notice of CARP
c. 35% c. Notice Landbank

20. Most superior lien on real property. 31. Authorized to divide the Philippines into
a. Mechanic lien different zones or areas and shall, upon
b. Mortgage lien consultation with competent appraisers both
c. Tax lien from the private and public sectors, determine
the fair market value of real properties.
21. Delinquent taxpayer whose real property a. Commissioner
sold on public auction can redeem property after b. DILG
sale. c. Mayor
a. Within 1 year
b. Within 3 months 32. If fair market valued prepared by assessor
c. Within 6 months is higher than prepared by BIR, the one shall be
followed for taxation.
22. Interest on delinquent real property tax per a. BIR
month. b. Assessor
a. 2% c. Court
b. 3% 33. Provided mechanism for the implementation
c. 4% of the Comprehensive Agrarian Reform Program
(CARP).
23. Interest on unpaid real property tax shall in a. EO 21
no case exceed. b. RA 9700
a. 36 months c. EO 229
b. 12 months 34. The responsibility to determine land
c. 24 months valuation and compensation for all lands
covered by CARP.
24. Asset not part of inventories for sale or used a. DAR
in trade such as the residential lot. b. Appraiser
a. Ordinary Asset c. Land Bank
b. Capital Asset
c. Personal asset
35. Identifies and screens potential b. Within 60 days
beneficiaries and validates their qualifications. c. Within 30 days
a. DENR
b. DAR 47. Seller shall pay to the provincial treasurer
c. Barangay Official real property tax from date of execution of sale.
a. Within 60 days
35. Lead agencies in the implementation of carp, b. Within 30 days
except c. Within 90 days
a. DENR
b. DAR 48. Right of the delinquent owner to redeem
c. Landbank the property from the date of sale.
a. Within 2 year
37. Shall coordinate and monitor the b. Within 3 years
implementation of the CARP in the province. c. Within 1 years
a. Provincial Agrarian Reform Coordinating
Committee (PARCCOM) 49. Allowable period for assessment of taxes
b. CARP Monitoring Committee prior to initial assessment of real property taxes.
c. Provincial CARP Monitoring a. 3 years
b. 5 years
38. Exemption on CGT sale of principal c. 10 years
residence can be availed only once every.
a. 10 year 50. LGU Sanggunian may condone real property
b. 5 years tax upon recommendation of local disaster
c. 3 years committee due to reasons, except.
a. General failure of crops
39. Percentage of payment for an installment b. Abundance season
sale to pay creditable withholding tax. c. Calamity
a. 2%
b. 25% of selling price 51. The basic real property tax and other
c. 30% taxes can be collected from the date they
become due and no collection shall be made
40. Tax rate for the cooperative registered in after that period.
CDA. a. Within 5 years
a. 0% b. Within 10 years
b. 3% c. Within 15 years
c. 5%
52. The basic real property tax and other
taxes can be collected from the date they
41. Real property tax share of the barangay. become due and no collection shall be made
a. 25% after that period if done fraudulently.
b. 30% a. Within 20 years
c. 40% b. Within 15 years
42. Real property tax share of the municipality. c. Within 10 years
a. 40%
b. 50% 53. Shall file a sworn declaration of value of
c. 60% the property once every three (3) years.
a. Tenant
43. In general the real property tax share of the b. Owner
barangay. c. Assessor
a. 30%
b. 35% 54. Owner shall file a sworn declaration of the
c. 40% true value of the property being improved.
a. 60 days after completion
44. Real property tax share of the barangay in b. 90 days after completion
the city. c. 120 days after completion
a. 30%
b. 40% 55. Donor tax when beneficiary is stranger.
c. 50% a. 40%
b. 25%
45. Real property tax share of the city. c. 30%
a. 60%
b. 70% 56. Engage in the business of leasing or renting
c. 40% real estate properties.
a. Real estate lessors
46. Seller shall pay to the provincial treasurer b. Developers
the real property tax from date of notarization. c. Manager
a. Within 90 days
57.Engage in the business of developing real b. Form 1906
estate properties into subdivision or similar units c. For 1903
on subdivided lots.
a. Manager 67. Penalties on failure to pay annual
b. Real estate developer registration fee.
c. Corporation a. 10% surcharges
b. 30%
58. Before commencing any business and c. 25%
payment of taxes.
a. Register with the municipal 68. Unlawful pursuit of business or omission.
b. Register with the barangay a. Fine not less than 5,000 but not more
c. Register business with BIR than 20,000
b. Fine not more than 5,000 but not more than
60. Registration requirement in BIR for 20,000
individuals. c. Fine not less than 10,000 but not more than
a. By laws 20,000
b. Articles of Incorporation
c. Birth certificate or ID 69. Imprisonment on unlawful pursuit of
business or omission.
61. Registration requirement for general a. 6 years but not more than 20 years
partnership. b. 5 years but not more than 20 years
a. Owner ID c. 6 years but not more than 15 years
b. Articles of partnership
c. Voters ID 70. Compromise payment for failure to register.
a. 10,000.00
61. Application form for individual in registering b. 20,000.00
with BIR c. 5,000.00
a. BIR form 1903
b. BIR form 1902 71. Compromise payment for failure to pay
c. BIR form 1901 annual registration.
a. 1,000.00
62. Application form for partnership b. 2,000.00
a. BIR form 1903 c. 3,000.00
b. BIR form 1904
c. BIR form 1905 72. Compromise payment for failure to display
certificate of registration.
63 Under Train Law, The VAT Exempt a. 1,000.00
Threshold on sale or lease of goods or b. 2,000.00
PROPERTIES or the performance of services is c. 3,000.00
increased from P1, 919,500 annual gross sales
and/or gross receipts to 73. Compromise payment for failure to display
a. P2,919,500 poster "ask for receipt"
b. P3,000,000 a. 1,000.00
c. P3,919,500 b. 2,000.00
d. P4,000,000 c. 3,000.00

64. Under the Train Law, Condominium dues 74. Invoicing requirement for sale of goods.
such as association dues, membership fees, a. Inspection paper
and other assessments and charges collected b. Receipt
on a purely reimbursement basis by c. Sales invoice
Homeowner’s association and condominium
corporations established under RA 9904 are 75. Invoicing requirement for sale of services or
exempt from ________ professional fees.
a. Non-Vat or percentage tax a. Invoices
b. Withholding Tax b. Official receipts
c. Vat Tax c. Inspection paper

65. Rate of percentage taxes on gross sales or 76. Maximum optional standard deduction.
professional fees of Non-VAT registered a. 40%
persons b. 30%
a. 3% c. 20%
b. 4%
c. 5% 77. Tax rate for corporation and partnership
a. 25%
66. Form used to update information like b. 40%
address and etc. c. 35%
a. Form 1905
78. Expanded withholding tax rate if professional c. 3 years
fees to juridical entities exceed 720,000.00
a. 15% 89. Books shall be audited and examined by
b. 20% independent CPA if gross receipts exceed.
c. 25% a. 150,000.00
b. 120,000.00
79. Expanded withholding tax rate if professional c. 160,000.00
fees to individuals below P3,000,000.00
a. 5% 90. Monthly remittance of income taxes
b. 10% withheld on compensation.
c. 15% a. 10th of the following month
b. 20th of the following month
80. Under Train Law, Documentary Stamp Tax c. 5th of the following month
Percentage for Deeds of Sale, Conveyances 91.Monthly remittance of income taxes withheld
and Donation of Real Property is now on compensation for November.
a. 1.5% a. 15th of December
b. 2% b. 15th of January
c. 3% c. 15th of November

81. Professional if there is no payment to be 92. Documentary stamp tax.

made. a. 5th day of the following month
a. Shall still file tax returns b. 15th day of the following month
b. No need to file c. 25th day of the following month
c. File in advance
93. Capital gain tax.
82. Due date for percentage taxes. a. Within 10 days after execution
a. 20th day after end of month b. Within 20 days after execution
b. 15th day after end of month c. Within 30 days after execution
c. 10th day after end of month
94. Estate tax
83. Fiscal due date for income tax of corporation a. Within 120 days from death
or partnership. b. Within 360 days from death
a. 20th day of the 4th month of the succeeding c. Within 100 days from death
year
b. 15th day of the 4th month of the 95. Donors tax
succeeding year a. Within 60 days from execution
c. 15th day of the 3th month of the succeeding b. Within 30 days from execution
year c. Within 50 days from execution

84. Fine on refusal to issue official receipts or 96. Surcharges if it is done willfully and
invoices upon conviction. fraudulently.
a. 1,000.00 but not more than 20,000.00 a. 50%
b. 1,000.00 but not more than 30,000.00 b. 20%
c. 1,000.00 but not more than 50,000.00 c. 10%

85. Compromise payment for failure to issue 97. Creditable withholding tax for habitually
receipt for 1st offence. engages in business and selling price is over
a. 10,000.00 2million.
b. 20,000.00 a. 5%
c. 30,000.00 b. 3%
c. 1%
86. Compromise payment for 2nd offense on
the use of unregistered receipts 98. Creditable withholding tax for habitually
a. 10,000.00 engage in business and selling price is over
b. 20,000.00 500,000. to 2 million.
c. 30,000.00 a. 1.5%
b. 5%
87. Compromise payment for 1st offense on c. 3%
refusal :o issue receipt.
a. 10,000.00 99. Creditable withholding tax for habitually
b. 30,000.00 engage in business and selling price is below
c. 25,000.00 500,000.00.
a. 1.5%
88. Years to preserve books after close of b. 3%
taxable year. c. 5%
a. 6 years
b. 5 years
100. Creditable withholding tax for not habitually
engage in business. 111 Who should pay for Real Property Tax?
a. 6% a. People who owns or whose names are on
b. 5% titles and certificate of ownership, whether
c. 4% the property is for residential or commercial
use.
101. Registration fee payment form. b. People who owns or whose names are on
a. BIR form 0605 agreements and SEC certificate, whether the
b. BIR form 0606 property is for residential or commercial use.
c. BIR form 0607 c. People who owns or whose names are on
Deed of Absolute Sale and Statement of
102. BIR form Certificate of registration. Account, whether the property is for residential
a. BIR form 0203 or commercial use.
b. BIR form 3203
c. BIR form 2303 112. The Metro Manila rate for Real Property tax
is.
103. BIR form to apply for authority to print a. Not exceeding 1%
receipts b. Not exceeding 2%
a. BIR form 0606 c. Not exceeding 3%
b. BIR form 1906
c. BIR form 0601 113. Amount of real property tax in the province.
a. Not exceeding 1%
104. Exempt from withholding tax b. Not exceeding 2%
compensation. c. Not exceeding 3%
a. Minimum wage earners
b. Maximum wage earners 114. Real property tax is based on:
c. Regular wage earners a. Zonal value of the property
b. Assessed value of the property
105. Detect non filing of tax return and non c. Market value of the property
payment of taxes d. Appraised Value of the property
a. BIR Integrated Tax System
b. Tax Integrated System 115. Aside from basic real property tax, local
c. BIR computer system governments also charge additional tax for
Special Education Fund. A _______ is levied on
106. Effectivity threshold amount of sales of the assessed value of the real property and
residential lot, house for sale or lease of proceeds of which go to the budget of local
property. schools.
a. RR 3-2012 a. 2%
b. RR 4-2013 b. 1%
c. RR 5-2011 c. 3%
d. 5%
107. Created to oversee and monitor the
implementation of this RA 9700. 116. If properties become idle or no activities,
a. Provincial Oversight Committee the government also charges a maximum of
b. CARP Oversight Committee _____% of the assessed value in addition to the
c.CongressionalOversight Committee basic real property tax.
a. 2%
108. Person who knowingly or willfully violates b. 1%
the provisions of R 9700 shall be punished by c. 3%
imprisonment. d. 5%
a. One month to 3 years
b. Two month to 3 years 117. In computing for the Property’s taxable
c. Three month to 3 years value or the assessed value, you must first
109. The forcible entry or illegal detainer by multiply the market value to the assessment
persons who are not qualified beneficiaries level. Assessment level from Section 218 of
under RA 9700 to avail themselves of the rights RA7160 in Metro Manila ON LANDS should be:
and benefits of the Agrarian Reform Program
shall be penalized of imprisonment. Statement 1. Assessment levels of Residential
a. 4 to 6 years should not exceed 20%.
b. 3 to 6 years Statement 2. Assessment levels of Agricultural
c. 1 to 6 years should not exceed 40%.

110. Dwelling place where a family resides is a. Statement 1 is True and Statement 2 is False
classified as. b. Statement 1 is False and Statement 2 is True
a. Special Asset c. Both Statements are True
b. Ordinary Asset d. Both Statements are False
c. Capital Asset
118. In computing for the Property’s taxable multiply the market value to the assessment
value or the assessed value, you must first level. Assessment level from Section 218 of
multiply the market value to the assessment RA7160 in Metro Manila ON MACHINERIES
level. Assessment level from Section 218 of should be:
RA7160 in Metro Manila ON LANDS should be:
Statement 1. Assessment levels of Residential
Statement 1. Assessment levels of Commercial, should not exceed 50%
Industrial, Mineral should not exceed 50%.
Statement 2. Assessment levels of Timberland Statement 2. Assessment levels of Agricultural
should not exceed 20%. should not exceed 40%

a. Statement 1 is True and Statement 2 is False a. Statement 1 is True and Statement 2 is False
b. Statement 1 is False and Statement 2 is True b. Statement 1 is False and Statement 2 is True
c. Both Statements are True c. Both Statements are True
d. Both Statements are False d. Both Statements are False

121. In computing for the Property’s taxable

119. In computing for the Property’s taxable value or the assessed value, you must first
value or the assessed value, you must first multiply the market value to the assessment
multiply the market value to the assessment level. Assessment level from Section 218 of
level. Assessment level from Section 218 of RA7160 in Metro Manila ON MACHINERIES
RA7160 in Metro Manila ON BUILDINGS and should be:
Other Structures should be:
Statement 1. Assessment levels of Commercial
Statement 1. Assessment levels of Residential and Industrial should not exceed 80%
with a Fair Market Value of
Statement 2. Assessment levels of Commercial
Fair Value Not Over Assessment should not exceed 40%
Over Levels
P175,000 0% a. Statement 1 is True and Statement 2 is
False
P175,000 P300,000 10% b. Statement 1 is False and Statement 2 is True
P300,000 P500,000 20% c. Both Statements are True
P500,000 P750,000 25% d. Both Statements are False
P750,000 P1,000,000 30%
P1,000,000 P2,000,000 35% 122. In computing for the Property’s taxable
P2,000,000 P5,000,000 40% value or the assessed value, you must first
P5,000,000 P10,000,00 50% multiply the market value to the assessment
0 level. Assessment level from Section 218 of
P10,000,000 60% RA7160 in Metro Manila ON SPECIAL
CLASSES should be:
Statement 2. Assessment levels of Assessment
Statement 1. Assessment levels of (CSH)
levels of Agricultural with a Fair Market Value of
Cultural, Scientific and Hospital should not
Fair Value Not Over Assessment exceed 15%.
Over Levels
P300,000 25% Statement 2. Assessment levels of Local water
P300,000 P500,000 30% districts, government owned corporations should
P500,000 P750,000 35% not exceed 10%
P750,000 P1,000,000 40%
P1,000,000 P2,000,000 45% a. Statement 1 is True and Statement 2 is False
b. Statement 1 is False and Statement 2 is True
P2,000,000 50%
c. Both Statements are True
d. Both Statements are False

a. Statement 1 is True and Statement 2 is False

b. Statement 1 is False and Statement 2 is True 123. In 1992, Alden Ricky bought a residential
c. Both Statements are True house and lot in Magallanes Village, Makati City
d. Both Statements are False for P50,000,000 with a market value of
5,000,000 for land and 3,000,000 for the building
*This may not the actual way on how they ask based on tax declaration, how much do you
question but for the purpose of review, we better think is his real property tax assessment?
to put it this way for computations of RPT. a. P50,000
b. P44,000
c. P52,000
120. In computing for the Property’s taxable d. P53,000
value or the assessed value, you must first
124. Vice Gondol bought a condominium 130. Mr. Zai, a self employed real estate broker
property in Mall of Asia, Pasay City for earned a Gross Sales Commission of
P5,000,000 with a market value of 900,000 P2,900,000 for year 2018, what is the tax rate of
based on his tax declaration. On 2019 the Pasay Mr. Zai?
LGU implemented a new ordinance adjusting a. Regular Personal Income Tax rate (PIT)
the assessment level as follows: b. 8% of Gross Sales Receipts in Excess of
P250,000
Fair Not Over RA 7160 Pasay c. Either Option 1: Regular PIT rates or
Value Assessme LGU 2019 Option 2: 8% of gross sales/receipts in
Over nt Levels Assessme excess of P250,000
nt Level d. Exempt
P750,000 P1,000,0 30% 60%
00 131. In the New Train Law, the amount of gross
P1,000,0 P2,000,0 35% 65% value of estate provided in estate tax returns
00 00 that requires a supported statement duly
P2,000,0 P5,000,0 40% 70% certified by a CPA is _________
00 00 a. from P2 million to P5 million
b. from P2 million to P7 million
What is the assessment level of Mr. Vice c. from P2 million to P10 million
Gondol? d. from P2 million to P12 million
a. 30%
b. 60% 132. Under the New Train Law, the filing of
c. 35% estate tax return extended to
d. 40% ________________ from the decedent’s death.
a. 6 months
b. 1 year
125. As a continuation of the previous problem: c. 8 months
How much is the estimated real property tax of d. 3 months
Mr. Gondol?
a. P11,800 133. In 2019, Yorme Kois a Filipino citizen
b. P10,800 donated a residential condominium property
c. P13,800 amounting to P6,000,000 located in Ayala
d. P12,800 Avenue Makati City to his brother. How much is
the donor’s tax ?
126. Under TRAIN Law, lawful heirs and a. Exempt
beneficiaries for estate tax would only be tax at b. 8% of the property
a. 8% c. Computed by old tax schedule of P204,000 +
b. 10% 10% over P3M
c. 6% d. 6% of the property
d. 7%
134. Mr. Willy Show, a Filipino citizen donated a
127. Under TRAIN Law, lawful heirs and residential condominium property amounting to
beneficiaries for estate tax would only be tax at P5,000,000 located in Pasig City to Mr. Jhong
a. 8% Dodong (stranger). How much is the donor’s
b. 10% tax ?
c. 6% a. Exempt
d. 7% b. 30% of the net gifts
c. Computed by old tax schedule of P204,000 +
128. When did President Rodrigo Duterte 10% over P3M
signed into law the Package 1 of the d. 6% of the property
Comprehensive Tax Reform Progran also
known as TRAIN Law which took effect on 135. The Documentary Stamp Tax under the
January 1, 2018? TRAIN law for Deed of Sale, Conveyances, and
Donation of Real Property Documents is
a. December 19, 2017 a. P15.00 for 1st P1,000; P15.00 for each next
b. December 18, 2017 P1,000
c. December 17, 2017 b. 1.% of value
d. December 16, 2017 c. 0.50 of value
d. 2% of value
129. It aims to make the Philippine Tax System
simpler, fairer, and more efficient to promote 136.Which price of a house and lot package sold
investments, create jobs, and reduce poverty. by a dealer is subject to E-VAT?
a. RA 11291 a. P2,500,000.00
b. RA 10963 b. P1,500,000.00
c. RA 7160 c. P2,000,000.00
d. RA 10051 d. P3,199,300.00
REAL ESTATE TAXATION C. Zoning Classification of the land
D. None of the above
I. Local Taxation
1. An official of the Local Government Unit, who 8. Elements of assessment process that
performs appraisal and assessment of real provides foundation of equity and uniformity in
Properties including plants, equipment's and realty taxation.
machineries essentially for taxation purposes. A. Assessment Level
A. Appraiser or Valuer B. Classfication of Real Property
B. Assessor or Assistant Assessor C. Assessed Value
C. Treasurer or Assistant Treasurer D. Actual Use of Property
D. Register of Deeds
9. In local taxation, real property shall be
2. The assessment level of the improvmenets of classified for assessment purposes on the basis
a property owned by Ms. Trixie Bless will be of its_____ regardless of where the property is
based on the classification and located, whoever owns it and whoever uses it:
A. Fair Market Value of the improvements as A. Zoning Classification
deteremined by the Assessor B. Actual Use
B. Assessed Value of the improvements as C. Actual use by the person in possession
deteremined by the Treasurer D. Land use plan
C. Zonal Value of the improvement as
deteremined by the BIR. 10. A property owner who is not satisfied or
D. Declared value by the owner as contained in does not agree with the assessment of the
the Sworn Statement. Assessor, may file an appeal or protest with the
Local Board of Assessment Appeals within ____
3. Quarterly payments of Real Property Tax can days from receipt thereof.
be paid on the following due dates: A. 30 days
A. March 30, June 30, September 30 and B. 60 days
December 31 C. 120 days
B. March 31, June 30, September 30 and D. 1 year
December 31
C. March 31, June 30, September 30 and 11. A property owner may proceed to______
December 30 after lapse of the period or within which the
D. March 30, June 30, September 30 and LBAA failed to act or denied the appeal.
December 29 A. Register of Deeds
B. Prosecutors Office
4. Real Property taxes discount if paid on or C. Central Board of Assessment Appeals
before March 31, of the current year is; D. Court of Tax Appeals
A. 20%
B. 15% 12. A special levy is the special education fund
C. 25% tax which shall be at a rate of:
D. 10% A. Not exceeding 1% of the Assessed Value
B. 1% of the Assessed Value
5. Real Property Taxes discount is given to C. 1% of the Market Value
taxpayer/s who will promptly pay their taxes for D. Not exceeding 1% of the Market Value
the succeeding year on or before?
A. 20% on or before December 31 13. The assessment level of Timberland
B. 10% on or before January 31 of the current containing an area 10 hectares with the Fair
year Market Value of 2,000,000 is:
C. 15% on or before January 31 of the current A. 70%
year B. 60%
D. 25% on or before June 30 of the Current year C. 65%
D. 55%
6. Under Sec. 219 of RA 7160, this code
requires the LGU concerned to conduct general 14. Assessment level of assessment for a
revision of property assessments every____ special class of real property like hospital is
thereafter from 1994 when the general revision only_____.
was first conducted after this code was enacted A. 15%
into law. B. 20%
A. 5 years C. 10%
B. 4 years D. 30%
C. 3 years
D. 2 years 15. The minimum income requirement of a
municipality to become a city according to RA
7. Assessment Levels for lands with existing 7160;
building of mixed uses will be based on the A. P100M per annum
A. Predominant actual use of the building B. P 20M per annum
B. Actual use of the land C. P 50M per annum
D. P 10M per annum B. Replacement cost of structures and
improvements therein
16. The Local Board of Assessment Appeals is C. Current Market value of crops and tress
composed of members provided under the Local therein
Government Code, except: D. Assessed value or the zonal value of the
A. Register of Deeds property
B. City Prosecutor
C. City Engineer 24. The following are the regular modes of ROW
D. CIty Assessor acquisition, except:
A. Donation
17. The following are the legal basis for real B. Negotiated Sale
property taxation except_______ C. Expropriation
A. Section 5, Article X of the 1987 Constitution D. None of the above
B. Section 197 of the Local Government Code
C. Section 200 of the Administrative of Real 25. Statement 1: PVS 600 is the Consideration
Property Tax of Hazardous and Toxic Substances in Valuation
D. Section 149 of the Presidential Decree 957
Statement 2: The objective of this Guidance
18. Refers to land devoted to agricultural activity Note is to assist Valuers in preparing valuation
as defined in RA 6557 and not classified as when specific hazardous or toxic substances
mineral, forest, residential, commercial or may influence property values.
industrial land. A. Statement 1 is True while statement 2 is
A. Residential Land False
B. Domestic Land B. Statement 1 is False while statement 2 is
C. Agricultural Land False
D. Farming Land C. Statement 1 is False while statement 2 is
True
19. Noel did not agree with the assessment D. Both Statements are true
made by the assessor on his property. Noel may E. Both Statements are false
appeal the same within what period?
A. 30 days from receipt of notice of assessment 26. The following taxes are being imposed and
B. 60 days from receipt of notice of collected by LGU Province, except:
assessment A. Real Property Tax
C. 90 days from receipt of notice of assessment B. Tax on Transfer on Real property
D. 120 days from receipt of notice of C. Idle land Tax
assessment D. Special Levy on Lands

20. The local government shall cause a notice of 27. For purposes of real property taxation idle
delinquency and thereafter the property and sold lands shall include the following, except:
at public auction in case of: A. Agricultural lands, more than one (1) hectare
A. Unpaid delinquent real estate taxes in area, suitable for cultivation, dairying , inland
B. Under declaration of value fishery, and other agricultural uses.
C. Payment under protest B. One-half ( 1/2) of which remain uncultivated
D. Delinquent real estate taxes for at least 5 or unimproved by the owner of the property or
years person having legal interest therein.
C. Agricultural lands planted to permanent or
21. The assessors Office is an agency where we perennial crops with at least fifty (50 ) trees to a
inquire and conduct research on hectare shall not be considered idle lands
A. Title Verification D. Lands actually used for grazing purposes
B. Investment Value shall likewise be considered idle lands.
C. Zonal Value
D. Cadastral Map/ tax Map 28. The rate of Tax on Transfer of Real Property
Ownership imposed by the LGU province.
22. How much will be the quarterly tax payment A. Not more than fifty percent ( 50%) of the
for a residential parcel of land valued at one percent (1%) of the total consideration or
P1,800,000.00 if the tax rate is 2%? the fair market value whichever is higher.
A. P7,200.00 B. Not more than fifty percent (50%) of the one
B. P1,800.00 percent (1%) of the total consideration or the fair
C. P3,600.00 market value whichever is lower.
D. P4,500.00 C. Not more than fifty percent (1/2%) of the one
percent (1%) of the total consideration or the fair
23. The following are to be considered in market value whichever is higher.
offering to the property owners in cases of D. Not more than fifty percent (50%) of the one
compulsory acquisition through negotiated sale percent ( 1%) of the total consideration or the
as required by the ROW project, except: fair market value whichever is lower
A. Current Market value of the land
29. What is the sharing ratio on the collections of proceeds to acquire a new residence within 18
Basic Real Property Taxes: months from the sale be assessed an additional
A. Province 30%, Municipality 40%, and deficiency capital gain tax inclusive of penalties
Barangay 30% and;
B. Province 35%, Municipality 40%, and A. 10% surcharges
Barangay 25% B. 15% compromise penalty
C. Province 40%, Municipality 35%, and C. 20% of surcharges per annum
Barangay 25% D. 25% penalty
D. Province 40%, Municipality 30% and
Barangay 30% 7. The rate of withholding tax for socialized
housing is __________ percent.
30. The following are the legal framework of the A. Zero
LGUs Power of Taxation , except: B. Five
A. Constitution C. Three
B. Local Government Code D. Two
C. Sangguniang Tax Ordinances
D. Sangguniang Tax Resolutions 8. A parcel of land was sold at P5,000,000.00
but the BIR Zonal Value is P4,800,000.00 while
II. Capital Gain Tax the local assessors fair market value is
1. Effective year 2012, a real estate broker shall P2,500,000.00 and it was appraised at
be subject to VAT if the total income for the year P5,500,00. What will be the basis to compute
exceeds. the capital gains tax?
A. P1,919,500.00 A. P5,000,000
B. P3,199,500.00 B. P4,800,000
C. P2,500,000.00 C. P5,500,000
D. P1,500,000.00 D. P2,500,000

2. Payment of the Capital Gain Tax for Capital 9.Atty Wilbert Panoy wanted to buy a new
assets become due after: residence and so he sold his personal residence
A. 30 days from the date of notarization of in Quezon City at P4,000,000.00. The BIR Zonal
document Valuation is P4,000,000.00. While looking for the
B. 30 days from the date of execution of the new residence, he escrowed to an authorized
document agent bank of BIR the 6 % capital gains tax.
C. Either a or b How much is the escrowed CGT?
D. None of the above A. P240,000.00
B. P300,000.00
3. The creditable withholding tax on the sale of a C. P375,000.00
house and lot package by a developer at the D. P75,000.00
price of Two Million Pesos is:
A. 1.5% 10. After selling his residence for P4,000,000.
B. 3% Atty. Wilbert Panoy was able to buy a new
C. 6% residence after 15 days in the amount of
D. 5% P3,000,000.00? How much is the capital gains
tax on the unutilized portion of the selling price
4. A lot was sold located at Placer, Masbate. of his old residence?
The owner Aaliya Bless is already residing in A. P60,000.00
Cebu wanted to pay transfer taxes while the B. P180,000.00
buyer in residing at Manila. Where is the Capital C. P240,000.00
Gains Tax on the sale to be paid: D. None
A. Manila
B. Masbate 11. How much will be the quarterly tax payment
C. Cebu for a residential parcel of land valued at
D. BIR Head Office P1,800,000.00 if the tax rate is 2%
A. P7,200.00
5. As provided for by RA 8424 or the Tax B. P1,800.00
Reform Act of 1997, the capital gains tax is 6% C. P3,600.00
and an exemption from it can be availed when D. P4,500.00
the sellers proceed from his principal residence
sold will be used to buy a new or construct a one 12. The following are considered engaged in the
within real estate business, except:
A. One ( 1) year A. Taxpayer whose primary purpose of engaging
B. 16 months in such business
C. 18 months B. Whose articles of incorporation states that its
D. Two (2) years primary purpose is to engage in real estate
business
6. Under BIR Revenue Regulation 17-2013, the C. Referred as Real Estate Dealers, real estate
seller of family home who failed to utilized the developers and or real estate lessors
D. Referred as Real Estate Broker, appraiser C. Execute an Affidavit of Undertaking
and consultant D. The same shall be presented for
revalidation to the District Office where the
13. Real Estate Dealers or real estate CAR was issued.
developers who are consider habitually engaged
in the real estate business should be registered 20. A bundle of rights encompasses five
with_________ different rights of the property owner, except:
A. Professional Regulation Commission A. The right to posses is the right to occupy the
B. Register of Deeds property. The right to control is the right to
C. Bureau of Internal Revenue determine interests and uses for others.
D. Housing and Land Use Regulatory Board B. The right to enjoy is the right to use the
(HLURB) or HUDCC property without outside interference.
C. The right to exclude is the right to refuse
14. The following are the basis of valuation of others interests or uses for the property.
property in computing CGT, except: D. The right not to dispose of and the right
A. Gross Selling Price not to determine how and if the property
B. Zonal Valuation should not be sold or given to another party.
C. Assessed Value of the Assessor
D. Appraisers Value III. ESTATE TAX
1. In payment of the Estate Tax, an allowed
15. The CGT rate for shares of stocks not traded deduction to the gross estate of the decedent is
on LSE effective January 1,2018 for Individual funeral expense which is:
taxpayer. A. 5% of the Gross Estate or P200,000
A. 5% whichever is lower
B. 10% B. 5% of the Gross Estate or P200,000
C. 15% whichever is higher
D. 20% C. 10% of the Gross Estate or P200,000
whichever is lower
16. The CGT rate for shares of stocks not traded D. 10% of the Gross Estate or P200,000 is
on the LSE effective January 1,2018 for higher
corporation.
A. 5% 2. Julice married to Ana in 1999. On 2009, Ana
B. 10% surviving parent died and she inherited two (2)
C. 15% hectare lot in Cebu City. After settlement of the
D. 20% estate, Ana sold the property without the
consent the objection of Julice. Is the sale valid?
17. The following are considered exempt from A. Yes, because the property is paraphernal
payment of final CGT, except: or exclusive property of the wife.
A. Dealer in securities, regularly engaged in the B. No, because the property turned to be
buying and selling of securities conjugal after the marriage
B. An entity exempt from the payment of income C. No, because Julice consent is wanting
tax under existing investment incentives and D. Yes, because the sale was already
other special laws consummated.
C. Individual/Non-individual exchanging real
property solely for shares of stocks resulting in 3. ______ is a mode of acquiring ownership and
corporate control. other real rights through the lapse of time in the
D. An private entity selling real property manner and conditions set forth by law.
A. Succession
18. ___________ is a certification issued by the B. Tradition
Commissioner or his duly authorized C. Donation
representative attesting that the transfer and D. Prescription
conveyance of land, buildings/ improvements or
shares of stock arising from sale, barter or 4. Who are compulsory heirs
exchange have been reported and the taxes due A. Legitimate children and their descendants
inclusive of the documentary stamp tax, have B. Legitimate parents and their ascendants
been fully paid. C. Illegitimate parents and siblings
A. Tax Clearance Certificate ( TCC) D. Legitimate brothers and sisters
B. Certificate Authorizing Registration ( CAR)
C. Certification Authorizing Registration (CAR) 5. _________ is the part of the testator’s
D. Certificate of Transfer of Title property which he cannot dispose of because
the law has reserved for certain heirs who are,
19. In case of failure to present the CAR to the therefore called compulsory heirs.
Registry of Deeds (RD) within the one (1) year A. Free Portion
period, what is the remedy of the taxpayer: B. Legitime
A. Present the same to the ROD C. Half of the Estate
B. Pay again the corresponding CGT and D. None of the above
request for another CAR from the BIR
6. Who are the secondary compulsory heirs A. 10 years
A. Legitimate children and their descendants B. 5 years
B. Legitimate parents and their ascendants C. 20 years
C. Illegitimate parents and siblings D. 3 years
D. Legitimate parents
13. Properties during the period of union without
7. All the property owned by the spouses at the marriage shall be governed by______
time of the celebration of the marriage or A. Provision of separation of property in the Civil
acquired thereafter constitutes___ Code
A. Conjugal Property B. Provisions of conjugal property in the Civil
B. Separation of property Code
C. Community of Property C. Laws on Co-ownership
D. None of the above D. None of the above

8. ______ is formed by a husband and wife 14. Family home-deemed constituted on a

whereby they placed in a common fund the fruits house and lot from the time it is
of their separate property and the income from occupied______.
their work or industry, the same is divided A. By the family
between them equally upon the dissolution of B. As a family residence
the marriage or the partnership. C. Registered under the name of the Head of
A. Conjugal Property the Family.
B. Community Property D. None of the above.
C. Separation of Property
D. None of the Above 15. If the TCT has an annotation that says
“subject to Rule 74, Section 4 of the Rules of
9. The following are the exclusive property of Court”, it means that the party is an inherited
spouses under conjugal partnership regime property and any heir unduly deprived of his
except______ lawful participation in the estate has______ to
A. Properties which is brought to the marriage assert his rights over the said property.
as his or her own: A. 10 years
B. Those acquired by either or both of the B. 3 years
spouses by their efforts or by chance C. 5 years
C. That which each acquires during the marriage D. 2 years
by gratuitous title
D. Properties which is acquired by right of 16.Benny Tai died leaving his daughter, Fina
redemption, by barter or by exchange with Tai, as sole heir to his residential house and lot
property belonging to only one of the spouses of as his only property. Which of the following is
the spouses; not an element of the succession on his
property, if the administrator of his estate is
10. The following are conjugal property of the Mama Tai?
spouses except._____ A. Benny Tai
A. The proceeds, products , fruits and income B. House and lot
from the separate properties of the spouse. C. Fina Tai
B. Those acquired by either or both of the D. Mama Tai
spouses by their efforts
C. Those acquired by either or both of the 17. Inheritance does not include___.
spouses by chance A. Property
D. Properties which is acquired by right of B. Public Office
redemption, by barter or by exchange with C. Rights not extinguished by death
property belonging to only one of the D. Obligations not extinguished by death.
spouses of the spouses.
18. Estate Tax is…
11. Who are the beneficiaries of Family Home A. A property tax because it is imposed on the
except: property transmitted by the decedent to his
A. Husband and Wife heirs.
B. The unmarried person who is the head of the B. An indirect tax because the burden of paying
family. the tax is shifted on the executor or any of the
C. Their parents, ascendants, descendants, who heirs of the decedent.
are living in the family and who depend upon the C. An excise tax because it is imposed on
head of the family for support. the privilege exercised by the decedent to
D. Brothers and sisters even residing abroad transfer ownership over the estate.
D. A poll tax because it is also imposed on
12. Family home shall continue even after death residents of the Philippines whether Filipino
of one or both spouses or of unmarried person Citizens or not.
for a period of____ or as long as there is a minor
and the heirs cannot partition the same unless 19. Which of the following is not a distinction
the court finds compelling reasons. between estate tax and donor’s tax?
A. The tax imposed is an excise tax. B. W - 3M , A -3M , B - 3M, Free portion - 3M
B. Extension for payment C. W - None, A- 6M, B - 6M , Free portion -
C. Effectively of the transfer of property. None
D. The exemption granted in the tax table. D. W - 2.2M , A - 4.5M , B - 4.5M , Free portion -
2.25M
20. Statement 1: The estate tax accrues at the
moment of death of the decedent. 26. Based on the following date, how much is
Statement: 2: In estate taxation, the taxpayer is the value of the descendant’s interest if he died
the decedent. March 31, 2015?
A. Statement 1 only
B. Statement 2 only Cash in bank, joint account of the decedent and
C. Both statements his wife - P 254,000
D. Neither statements
Interest on the bank deposit ( Jan 1- June
21. Which of the following statements is wrong? 30,2015) - P 9, 000
A. An essentially mortis causa transfer which
has been titled as inter vivos shall be subject Dividends from a domestic corporation - P
to donor’s tax. 60,000
B. Estate tax is more of a revenue tax rather
than a special tax. Date of Declaration - February 5, 2015.
C. If the decedent died September 5, 2011 but Date of record - April 15, 2015
the actual transfer of possession of the property Date of Payment - May 15, 2015
to the heirs took place on June 5, 2015 , the
estate tax will be computed based on the Share in 2014 net profit of partnership,
prevailing law on September 5, 2011. distributed to Partners on April 15 - P9,000
D. Under the Benefit-Received Theory in estate
taxation, the state is a partner of the decedent in Winning in lotto ( Bet. March 30; April 1, 2014
the distribution of the latter’s estate. draw) - P500,000

22. In 2009, J. Cruz gave a lane of P150,000 to A. P383,750

Sexy, his secretary. In 2012, as an act of B. P138,000
generosity, J. Cruz condoned the debt of Sexy C. P145,000
in his last will and testament. J. Cruz died in D. P388,250
2015. The condonation of debt of Sexy is a
(RCPA). 27. For estate tax purposes, the estate of the
A. Donation inter vivos subject to donor’s tax. decedent shall be valued at the time.
B. Payment or compensation for the services A. Of the preparation of the estate tax return
rendered. B. The estate tax is paid
C. Deduction from the gross estate of J.Cruz. C. Of death of the decedent
D. Donation mortis causa subject to estate D. The estate is distributed to the heirs.
tax.
28. Mamo died leaving the following properties:
23. The following are the motives of a taxpayer Stocks of Cruz Corporation ( 2,000 shares) -
that preclude the transfer in contemplation of listed in Phisex ( Highest - P40; lowest - P39)
death, except one ( RCPA)
A. To relieve the taxpayer of the burden of Common Stocks of Hemo Corporation ( 1,500
management. shares) - not listed in the stock exchange. Cost -
B. The save income and property taxes. P50 per share; market value - P45 per share.
C. To avoid payment of estate tax.
D. To make dependents financially independent. Car (cost - P600,000; book value - P350,000;
market value - P400,000)
24. In default of testamentary heirs, the law
determines who are to succeed to the Real properties ( zonal value - P120,000;
inheritance of the deceased. Which of the assessor’s value - P72,000)
following ranks first in the order of succession?
(RPCPA). The gross estate of Mamo is---
A. Legitimate Children. A. P618,500
B. Surviving spouse B. P867,500
C. Legitimate parents C. P624,000
D. Illegitimate children. D. P666,500

25. H and W are married. They have legitimate 29. Ulyanov Kerivsky, Ukrainian, died in the
children A and B. H died, survived by W, A and Philippines. The properties situated in his own
B. His estate of P12,000,0000 should be divided country will not be subject to estate tax if he was
as follows: a---
A. W - P3M, A - P4M, B - P4.5M, Free portion - A. Resident Citizen
None B. Resident Alien
C. Nonresident citizen 35. One of the following donations is not
D. Nonresident alien included as part of gross estate.
A. Revocable Transfers
Items 30 Through 32 are based on the B. Transfers with reservation of certain rights
following information: C. Transfer under special power of
appointment.
Dina Mathay, Filipino, died in the United States D. Transfer in contemplation of death
with the following properties - P2,000,000

Shared of stock in a foreign corporation- 36. Which of the following transfers is included
P600,000 in the gross estate?
A. Transfer inter vivos
Interest in a partnership, domestic - P475,000 B. Transfer under general power of
appointment.
Blank deposit in a New York City Bank - C. Transfer under special power of appointment
P150,000 D. Transfer for an adequate and full
consideration
Car in Cebu , donated inter vivos 5 years ago to
her son - P500,000 37. Decedent Jose Llamaldo has the following
data:

30. Which property should be included in the  Value of the property at the time of sale -
gross estate? P1,200,000
A. All the above properties.  Value if consideration when sold -
B. Only the properties located in the Philippines P1,000,000
C. All the above properties except the car.  Value of the property at the time of death -
D. The properties located in the Philippines P1,500,000
except the tangible
The amount includible in the gross estate is-
31. If the decedent was a nonresident alien A. P300,000
( with reciprocity), how much is the gross B. P500,000
estate? C. P200,000
A. P3,725,000 D. P1,500,000
B. P975,000
C. P500,000 38. On the belief that he was about to die of a
D. None liver cancer, Bongbong sold to Bengbeng a
property valued at P1,000,000 for the same
32. If the decedent was a non-resident alien amount. Six months later, Bongbong died of a
( no reciprocity), how much is the gross estate? car accident. At that time, the property had
A. P3,725,000 already a value of P1,300,000. For Philippine
B. P975,000 estate tax purposes, the amount includible in the
C. P500,000 gross estate of Bongbong is--.
D. P475,000 A. P1,100,000
B. P1,300,000
33. Which of the following is an intangible C. P200,000
personal property within ? D. None
1. Franchise exercised in the Unites States.
2. Shares or rights in a domestic business 39. On February 1,2005, Angel prepared a will
partnership. on his property in favor of his children. Angel
3. Bonds issued by an American Corporation. died September 5, 2005 survived by his children
4. Stocks issued by foreign corporation with Bersabe and Contado who immediately took
business situs in the Philippines. over possession and made an extrajudicial
A. 2 Only partition on September 20, 2005 but without
B. 2 & 4 registering the same in the Register of Deeds.
C. All of the above properties Bersabe sold the Property to Contado on May
D. None of the above properties 7,2015 in order to finance his expenses for
hospitalization. Which date should be used as
34. An example of intangible personal property the basis in valuing the property for purposes of
without is: computing the estate tax?
A. Domestic shares of stocks. A. February 1, 2005
B. Foreign shares, 85% of the business of B. September 5,2005
corporation is in the Philippines. C. September 20,2005
C. Foreign shares with business situs in the D. May 7,2015
Philippines.
D. Foreign shares, with certificate of stocks 40. Which of the following is not a distinction
are kept in Makati. between estate tax and donor’s tax?
A. The tax imposed is an excise tax
B. Extension for payment A. Estate tax
C. Effectively of the transfer of property. B. Donor’s tax
D. The exemption granted in the tax table. C. Income tax
D. Transfer tax
III. DONOR’S TAX
9. The gift tax is imposed on the transfer of
1. Based on the net gift made on January 31, property (not on the property itself), which is why
2017 and January 31, 2019, the maximum it has been sustained as a (an)
donor’s tax is: A. Excise tax
A. 10% and 30% B. Property tax
B. 15% and 30% C. Donee’s tax
C. 20% and 6% D. Poll tax
D. 30% and 6%
10. A donation made by a stockholder to a
2. Donation made to a stranger on December corporation is subject to donor’s tax because of
31, 2017 is subject to____ tax based on the the following principles, except
zonal value or market value whichever is higher; A. Entity Theory
A. 15% B. Lifeblood Theory
B. 12% C. Benefit received principle
C. 20% D. Tax Benefit Rule
D. 30%
11. What is the tax implication if a corporation
3. Donation made to a stranger on December condones the debt of a stockholder because of a
31, 2019 is subject to ____ tax based on the good thing done by the latter to the corporation?
zonal value or market value whichever is higher: A. The condonation is based on the liberality of
A. 15% the corporation; therefore, it is subject to donor’s
B. 12% tax.
C. 6% B. The condonation is subject to donor’s tax on
D. 0% the corporation because it is based on its liberty.
Moreover, it is equivalent to a payment of
4. Donations made to the parish priest who heart dividend to the stockholder which is, therefore,
the confession of the donor during the latter’s subject tax of 10%.
last illness, or the minister of the gospel who C. It is tantamount to a declaration of
extended spiritual aid to him during the same dividend. Therefore, it is an income which is
period is____. subject to 10% dividend tax on the
A. Unenforceable stockholder. However, it is not subject to
B. Void donor’s tax on the corporation.
C. Voidable D. It is just a simple case of extinguishment of
D. Ineffective an obligation which is neither subject to income
tax on the stockholder not subject to donor’s tax
5. Donations made between husband and wife, on the corporation.
directly or indirectly, except moderate gifts on
the occasion of family rejoicing is_____. 12. Madz went to Bersabaren Resort and was
A. Unenforceable given a prize of P50,000 by the resort for being
B. Void its 1,000th guests. Is the prize subject to donor’s
C. Voidable tax? Income tax?
D. Ineffective A. Donors tax - Yes ; Income tax - Yes
B. Donors tax - No ; Income tax - Yes
6. ______ is an act liberality whereby a person C. Donors tax - Yes ; Income tax - No
disposes gratuitously of a thing or right in favor D. Donors tax - No ; Income tax - No
of another, who accepts it.
A. Succession 13. The following are the requisites of a donation
B. Donation for purposes of the donor’s tax, except
C. Tradition ( RPCPA)
D. Prescription A. Capacity of the donor
B. Capacity of the Donee
7. An act of liberty whereby one disposes C. Delivery of the subject matter of gift
gratuitously of a thing or right in favor of another D. Donative intent
who accepts it__
A. Succession 14. A donation of one (1) hectare of timberland--
B. Occupation A. Can be done orally or in writing
C. Donation B. Must be in writing
D. Tradition C. Maybe in a private document
D. Must be in a public document
8. A tax imposed on the gratuitous transfer of
property between two or more persons who are 15. One of the following is a valid donation
living at the time the transfer is made.
A. Oral donation of a cellular phone worth D. A and B are the only heirs of C. A
P4,500. renounces his share of inheritance in favor
B. Oral donation of a passenger jeepney worth of B.
150,000.
C. A parcel of land worth P5,000 in a private 21. Which of the following is subject to donor’s
document tax?
D. A parcel of land worth P500,000 in a private A. Donation Inter-vivos to Iglesia Ni Cristo.
document. B. Donation Inter-vivos to International Rice
Research Institute.
16. Which of the following constitutes a taxable C. Cash contribution to a political candidate,
gift? duly reported to the Commission on Elections.
A. Creditor’s gratuitous discharge of a D. Remission of debt where the debtor did
debtor’s obligation. not render services in favor of the creditor.
B. One day rent-free use of another’s property.
C. A gratuitous transfer by an incompetent. 22. A tax minimization scheme which is done by
D. An agreement to make a future which is not spreading the gift over numerous calendar years
supported by a consideration. to avail of lower tax liability-.
A. Spread-out method
17. Antonio donated shares of stocks of B. Splitting of gift
Cayatano Corporation to Barandilla on April 20, C. Donation of life insurance
2015 with a right to revoke it. The donor D. Void donation
delivered the property April 25, 2015. On June
20, 2015 Antonio relinquished the right to 23. The spouses Helena and Federica wanted to
revoke. Ten days after, the donor died. For donate a parcel of land to their son Dondon who
purposes of donor’s tax, the gross gift should be is getting married in December 2014. The parcel
based on the value of the shares on. of land has a zonal valuation of P420,000.00.
A. April 20,2015 What is the most efficient mode of donating the
B. April 25, 2015 property? (BEQ)
C. June 20, 2015 A. The spouses should first donate in 2014 a
D. June 30,2015 portion of the property valued at P20,000.00
then spread P400,000.00 equally for 2015,
18. Warren wrote a letter to Lamont on 2016, 2017 and 2018.
December 31, 2014 donating his car worth B. Spread the donation over a period of 5 years
P350,000. The letter was received by the latter by the spouses donating P100,000.00 each year
on January 7,2015 who accepted the donation. from 2014 to 2018.
The letter was not paid until May 22,2016. The C. The spouses should each donate a
donation was consummated on. P110,000.00 portion of the value of the
A. December 31, 2014 property in 2014 then each donate
B. January 15, 2015 P100,000.00 in 2015.
C. January 7, 2015 D. The spouses should each donate a
D. May 22,2016 P100,000.00 portion of the value of the property
in 2014, and another P100,000.00 portion each
19. On August 18, 2015 Elizabeth loaned to her in 2015. Then , in 2016, Helena should donate
sister Martha P200,000 at an interest of 12% per the remaining P20,000.00.
annum payable one (1) year thereafter. One
month before the debt due, Martha’s husband 24. Statement 1: When the donee is exempt
died. Consequently, Elizabeth informed her from income tax, the donation made by a
sister that she is condoning the loan including taxable individual is also tax-exempt.
the interest. How much is the value of the Statement 2: Proceeds of life insurance policy
donation made by Elizabeth to Martha? on the life of the decedent where the designation
A. P200,000 of the beneficiary is irrevocable is always subject
B. P224,000 to donor’s tax.
C. P222,000 A. Statement 1 - True ; Statement 2 - False
D. None B. Statement 1 - False ; Statement 2 - True
C. Statement 1 - False ; Statement 2 - False
20. Which of the following examples is not D. Statement 1 - True ; Statement 2 - True
taxable (RPCPA) ?
A. Filipino citizen donated a parcel of land 25. Statement 1: The agreement between the
located in the Units States to B, a nonresident donor and the donee that the latter shall assume
alien. the tax burden is binding on the government.
B. On June 12,2015, A made a gift of P200,000 Statement 2: There is no donor’s tax in a
to his daughter on account of her marriage donation on account of marriage if the marriage
celebrated May 1,2014 did not actually take place.
C. Mr. Ramos, a multi-millionaire, gives his wife A. Only the first statement is wrong
a diamond ring worth P120,000 as a birthday B. Only the second statement is wrong
gift. C. Both statements are wrong
D. Both statements are correct
 C. Obligations or bonds issued by a foreign
26. On June 23, 2015, Freddie Boy, a mentally corporation with business situs in the
defective 12 - year old boy, executed a deed Philippines.
donating to his brother Aldy a one (1) hectare lot D. Shares of stocks issued by a foreign
worth P250,000 located in Magarao, Camarines corporation 51% of the business of which is
Sur which was also donated to Freddie Boy by located in the Philippines.
his father a year ago. The donation is---
A. Void, because Freddie Boy does not own the 31. Given the following statements:
property considering that the donation made to I. A donation by a nonresident alien of shares of
him by his father is void. stock issued by a domestic corporation is
B. Void, because Freddie Boy, the donor is subject to donor’s tax if such shares have
minor and mentally defective. acquired business situs in the Philippines.
C. Valid, although unenforceable II. A donations by a resident alien of shares of
D. Valid, although voidable because the stock of a foreign corporation will only be subject
donor is not capacitated to donate property. to donor’s tax if at least 85% of the business of
such corporation is located in the Philippines.
27. Which of the following donations is subject to III.A donation by a non-resident alien of bonds
donor’s tax? issued by a foreign corporation is subject to
A. Those made between persons who were donor’s tax if 90% of the business of such
guilty of adultery or concubinage at the time of foreign corporation is situated in the Philippines.
the donation. IV. A donation by a nonresident citizen of a
B. Those made to conceived and unborn franchise will be subject to donor’s tax in the
children. Philippines.
C. Those made to a public officer by reason of
his office. Which of the above statements is/are correct?
D. Those made between husband and wife A. Statement I and III
during their marriage. B. Statement II and IV
C. Statements III and IV
28. Antioquia donated a 1,000 square meter D. Statements I and IV
land to Botor with a condition that within two (2)
years from the date of donation, Botor will 32. Who of the following cannot claim P10,000
construct a two-storey building thereon, and that exemption on gifts on account of marriage?
failure of the donee to comply with the condition A. Resident Citizen
shall be sufficient ground for the revocation of B. Nonresident Citizen
the donation. C. Resident Alien
I. There shall be donor’s tax on the donation D. Non-resident Alien
even if it may be revoked in case of non-
fulfillment of the donation. 33. One of the following cannot claim P10,000
II. In case of revocation of the donation, The exemption on gifts on account of marriage?
donor’s tax paid to the government may be A. P10,000 dowries or gifts given on account
refunded to the donor. of marriage of a legitimate son
A. Statement 1 only B. Donation to the national government, its
B. Both Statements agencies or instrumentalities or political
C. Statement 2 only subdivisions thereof.
D. Neither statements C. Donation to a non-profit educational
institution not more than 30% of the gift is used
29. Which of the following statements is false? for administration purposes.
The gross gift of a non-resident alien D. The exemption of P100,000 in the tax table
A. Will include all intangible personal for donor’s tax.
properties regardless of location 34. Given the following statements:
B. Will include all intangible personal properties Statement I: A donation by husband and wife
situated in the Philippines jointly of a conjugal property will require two
C. With reciprocity will not include all intangible separate computations of donor’s tax which will
personal properties regardless of location. be contained in two separate donor’s tax return.
D. Without reciprocity will not include all
intangible personal properties situated outside Statement II: If the property donated is a
the Philippines. community property of the spouses, the spouse
who opposes the donation shall not be
considered as a donor and will not be required
30. Which of the following is not considered as to pay donor’s tax return.
an intangible personal property within?
A. Franchise which must be exercised in the Statement III: If the property donated is a
Philippines. community property of the spouses, each of
B. Shares of stocks issued by a domestic them is considered as a donor of his or her
corporation. share in the co-owned property and shall be
liable for whatever tax that may accrue on such
donations.
 C. The daughter of Ananias was married to her
Statement IV: As a rule a donation inter -vivos boyfriend. As a gift, Ananias donated cash worth
between spouses during the marriage is P100,000 to his daughter.
voidable. D. Property worth P80,000 was donated by
Bibong to Barangay Maaliwalas for use as a site
A. Statement 1 and 4 are true of the Barangay Hall.
B. Statement 1 and are true
C. Statements 1,2 and 3 are true. 38. The following does not result to a gross gift.
D. Statements 2 and 3 are true. A. Donation to the Development Academy of the
Philippines.
35. Given the following statements: B. Donation of a parcel of land to brother, the
donation is in a private document.
Statement I: If the marriage is not validly C. Donation of a real property to the City of
solemnized, the donor is not entitled to the Manila.
P10,000 exemption because the donation D. Donation of property the encumbrance
propter nuptias is not also valid. therein was assumed by the donee.

Statement II: Donations propter nuptias by an 39. Exempted from donor’s taxation are gifts
adopting parent on account of the wedding of his made (BEQ)
child by natural adoption will entitle the donor to A. For the use of the Barangay
an exemption from gross gift of P10,000. B. 0In consideration of marriage.
C. To a school which is a stock corporation
Statement III: A wedding ceremony which was D. To a for-profit government corporation.
solemnized by the Mayor is not valid because he
is not authorized to solemnize marriages under 40. All the following, except one, are exempt
the Family Code, thus the P10,000 exemption from donor’s tax. Which is it?
from gross gift cannot be claimed by the donor A. Donation to the Philippine Red Cross
of a donation propter nuptias. B. Donation to the Development Academy of the
Philippines.
Statement IV: There is no P10,000 exemption C. Donation directly given to the victims of
from gross gift on a donation propter nuptias the eruption of Mount Bulusan.
given by a parent to his daughter who will D. Donation to the City of Davao for public
celebrate her 50th wedding anniversary. purpose.

Choose the best answer: 41. A non-stock, non-profit school always had
A. Statement 1 is true cash flow problems, resulting in failure to recruit
B. Statement 2 is false well-trained administrative personnel to
C. Statements 2 and 3 are false effectively manage the school. In 2015, Don
D. Statements 1 and 2 are true Leon donated P100 Million pesos to the school,
provided the money shall be used solely for
36. Justine donated cash to his son on account paying the salaries, wages, and benefits of
of marriage on October 2014 as follows: administrative personnel. The donation
January 15, 2015 - P25,000 represents less than 10% of Don Leon’s taxable
March 10,2015 - P20,000 income for the year. Is he subject to donor’s
July 15, 2015 - P50,000 taxes? ( BEQ)
September 10,2015 - P100,000 A. No, since the donation is actually, directly,
and exclusively used for educational purposes.
The donor’s tax payable on September 10,2015 B. Yes, because the donation is to be wholly
donation is__ used for administration purposes.
A. P780 C. Yes, since did not obtain the requisite NGO
B. P1,700 certification before he made the donation.
C. P1,380 D. No, because the donation does not exceed
D. Exempt 10% of his taxable income for 2015

37. Which of the following donations result to a 42. Annie donated the following properties:
net gift of P80,000? Land in Los Angeles, California, USA -
A. Alakdan donated property to Balbakwa with a P250,000
market value of P140,000. The property is Land and building in Jolo, Sulu - P175,000
subject to a mortgage indebtedness of P60,000, Car registered in the State of California , USA -
which was paid by the donor at the time of the P225,000
donation. Jewelries in the Philippines - P45,000
B. Altura requested Busines to pay Altura’s Shares of stock in a corporation based in USA -
liability with Cabangis in the amount of P60,000
P100,000 and in return, the personal property Accounts Receivable, debtor in the Philippines -
of Altura valued at P180,000 will be donated P25,000
to Busina.
If Annie is a resident citizen, the gross gift is---
A. P780,000 C. Statements 3 and 4 are correct.
B. P295,000 D. Statement 2 is false.
C. P245,000
D. P220,000 49. A stranger in donor’s taxation
A. Great Grandchild
43. The gross gift of Annie if she is a B. Nephew
nonresident alien without reciprocity is__ C. Child by natural adoption
A. P780,000 D. Grand auntie
B. P295,000
C. P245,000 50. Sayers, who is single, gave an outright gift of
D. P220,000 P150,000 to a friend, Johnson, who needed the
money to pay medical expenses prior to the
44. The gross gift if Annie is nonresident alien Train Law--
with reciprocity is--- A. The donation is not taxable because the gift is
A. P780,000 outright.
B. P295,000 B. The donor’s tax payable is P1,000
C. P245,000 C. The donor’s tax is P45,000.
D. P220,000 D. The donation is deductible from the gross
income of Sayers.
45. Butch made the donation to his children in
2015. In which of the following successive CONTINUATION OF REAL ESTATE
donation will Butch pay donor’s tax? INVESTMENT TRUST
A. January 15 - To Alma on account of
marriage , P40,000 1. Philippines first REIT firm
B. March 15 - To Ara on account of graduation - A. DoubleDragon REIT
P45,000 B. Filinvest REIT
C. May 15 - To Aiko on account of her 18 th C. GoldenLand REIT
birthday, P50,000 D. Ayala Land REIT (AREIT), Inc.
D. In all of the above donations.
2. To facilitate easier registration for REIT fund
46. Which of the following statements is false? managers, the SEC lowered the minimum paid-
A. Donor’s tax applies also to juridical persons. up capital requirement of foreign corporations
B. For purposes of donor’s tax, second cousins intending to engage in the business of fund
are strangers to each other. managers to.
C. Encumbrance on the property donated, if A. P60 million from P100million
assumed by the donor is deductible for B. P40 million from P100million
donor’s tax purposes C. P50 million from P90 million.
D. As a rule, donation between husband and D. P50 million from 100million.
wife during the marriage is void.
3. Refers to the plan, including its amendments,
47. Which of the following is not a factor in the of the REIT registered with the Commission.
determination of taxable gifts? A. Securities Regulation Code
A. Identification of transfers included in gross B. Related Corporation
gift. C. REIT Plan
B. Application of exempt transfers. D. Managed Funds
C. Subtraction of allowed deductions.
D. Multiplying net gift by the applicable rates. 4. The schedule of Zonal Valuation used in the
computation of the capital gains tax is prepared
48. Given the following statements: by.
A. The Assessor’s Office
Statement I: The donor’s tax payable on the B. The Bureau of Internal Revenue
present donation includes the previous C. National Tax Research Center
donations made during the current year. D. Department of Finance
Statement II: It is not proper to add the prior net
gifts during the current year because the taxes BASIC APPRAISAL FOR REAL ESTATE
paid on these donation will just be credited from BROKERS
the donor’s tax computed.
Statement III: The tax rates in the tax table for 1. Statement that appraisers, in their
donor’s tax are relatively lower than the tax rates professional capacity, personally conducted the
in the tax table for the estate tax. appraisal in an objective manner.
Statement IV: The highest tax rate in the tax
table for donor’s tax is higher than the highest Certification of report
tax rate for estate tax.
2.Provides the cost to construct a building by
Choose the best answer:
estimating the installation costs, including
A. Statements 1 and 2 are false.
materials, of the individual components of the
B. Statements 1,2 and 4 are false.
structure.
 Economic life
Unit in place method
14. Method of land valuation in the absence of
3. Influence outside of the property boundary vacant land sales, whereby improvement values
that may affect its value. obtained from the cost model are subtracted
from sales prices of improved parcels to yield
Externalities residual land value estimates.

4. Identify the market supply and demand of a Abstraction method

particular product
15. Refers to a price expressed in terms of
Market analysis money payable for the asset in an arm's length
market transaction.
5. If you live in a neighborhood of single-family
houses, you don't want an office building to be Estimated amount
built across the street from your house.
16. The process of analyzing sets of property
Conformity and market data to determine the specific
parameters operating upon a model.
6. Valuation approach use in the single family
homes. Calibration

Sales comparison approach 17. Risk due to uncertainty in rent, vacancies

and operating expenses.

7. It assumed that deterioration and wear occur Business risk

at a constant average annual rate
18. Value a property holds to a specific person
Straight line depreciation who may use it for a specific purpose that's
generally unavailable to the typical buyer.

8. The seller is under financial or other pressure Value in use

to sell quickly.
18. The whole is sometimes greater than the
Forced sale sum of its parts.

Plottage
9. Additional element of value created by the
combination of two or more interests where the 20. Describes the value of an asset that has
value of the combined interest is worth more reached the end of its economic life for the
than the sum of the original interests. purpose it was made.

Synergistic value Salvage value

10. In the absence of sufficient direct market 21. Individual properties, such as hotels, fuel
evidence, acceptable method of arriving value of stations, and restaurants that usually change
specialized property. hands in the marketplace while remaining
operational.
DRC
Trade Related property
11. The result of subtracting the vacancy and
collection loss from potential gross income. 22. Tasked with the professionalizing and raising
the level of property valuation industry by
Effective gross income developing valuation standard for public and
private use.
12. This describes a situation where a group of
assets employed together in a business are DOF
offered for sale separately, usually following a
closure of business. 23. All property value is created by the of the
future benefits the property will provide.
Liquidation value
Anticipation
13. The number of years a building contribute to
the value of the land. 24. The idea that nothing remains the same.
Change
Economic obsolescence
25. Risk due to uncertainty in future interest.
39. The amount for which an asset could be
Interest risk exchanged between knowledgeable, willing
parties in an arm's length transaction.
26. Uses the gross annual rent rather than
monthly Fair value
40. If that building is a success other builders
Gross income multiplier are likely to follow with more office buildings until
the last office building a builder erects remains
27. Poor layout is an example of . partially vacant because the suppliers have
created a surplus of office space.
Functional obsolescence
Competition
28. The value of an element or component of
property depends on how much it contributes to 41. Establishes that each party is motivated to
the whole. undertake the transaction, but neither is forced
or unduly coerced to complete it.
Contribution
Without compulsion
29. Provide a framework for valuations of assets
that are to be offered or taken as loan security. 42. Method for appraising real estate based on
its income.
PVA 2
Income capitalization approach
30. Review of a Valuer's work undertaken by
another Valuer exercising impartial judgment. 43. Describes a situation where an entire
business is transferred as an operational entity.
Valuation review
Going concern value
32. "Use that result in the highest value for that
property." 44. Value to a specific investor with a specific
plan for the property.
Highest and best use
Investment value
18. Considers the income that an asset will
generate over its remaining useful life and 45. The value that appraisers deal with most
estimates value through a capitalization process. often.

Income approach Market value

34. An amount above the Market Value that 46. Valuation approach use in the unique
reflects particular attributes of an asset that are properties such as the church
only of value to a Special Purchaser.
Cost approach
Special value
47. Form of deterioration that is economically
36. Risk due to the use of debt financing. feasible to repair.

Financial risk Curable

36. The positive difference between selling price 48. Applies the basic economic principle that a
and cost buyer will pay no more for an asset than the cost
to obtain an asset of equal utility, whether by
purchase or by construction.
Surplus productivity

37. The buyer will pay no more for a property Cost approach
than the cost of an equally desirable alternative
property. 49. Prepared the first documented valuation
manual in Ireland.
Substitution
Sir William Petty
38. Loss in value due to factors outside the
properties
50. Cost to create a virtual replica of the existing 60. Very open and most transparent method of
structure. selling property.

Reproduction Auction sale

51. The present value of the future cash flows 61. When the seller help finance part or all of the
expected to be derived from an asset or cash- purchase price.
generating unit.
Seller financing
Value in use
62. The seller receives the full payment from the
52. Process of valuing many properties at the buyer.
same time.
Cash sale
Mass appraisal
63. Is the use of borrowed money to finance all
53. Value is determine by the interaction of or part of purchase price of the real estate.
forces in the appropriate market
Leverage
Principle of demand and supply
64. Resulting from external influences may
54. The amount of money necessary to affect the value of the asset.
purchase the finished goods or item of property
when offered for sale in the open market. Obsolescence
Price 65. A valuation review that is limited to the data
presented in the report, which may or may not
53. Value is created by expectation of future be independently confirmed.
benefits.
Desk review
Anticipation
66. A valuation review performed by a client or
54. The process of analyzing and weighing the user of valuation service as an exercise in due
results of the various approaches as applied to diligence when the valuation is to be used for
an appraisal problem. purposes of decision-making such as
underwriting, purchasing, or selling the property.
Reconciliation
Administrative review
55. Technique for estimating value is based on
the idea that a property value can be calculated 67. A revenue-raising procedure, based on the
as a multiple of the gross rent. assessed value of property related to a scale of
charges defined by statute within a specified
Gross rent multiplier time frame.

56. The higher values of larger homes tend to Ad Valorem Property Taxation
have a positive effect on the lesser value of the
smaller home. 69. The period of time over which the structure
may reasonably be expected to perform the
Progression function for which it v/as designed or intended.

57. Estimate of how old the building appears to Useful life

be.
70. Estimating depreciation is a way to calculate
Effective age depreciation caused by wear and tear on the
structure that presumes that structures wear at
58. Valuation approach use in the unique the same rate each year.
properties such as the church
Straight line method
Cost approach
71. Outmoded design in older structures or
59. Valuation approach use in investment unacceptable design in newer structures usually
properties such as office space or commercial points to a type of depreciation.
space.
Functional obsolescence
Income approach
1. The income that the building generates when Equity
rented at 100 percent occupancy.
86. A valuation review that includes inspection of
Potential gross income the exterior and sometimes the interior of the
subject property and 87. possibly inspection of
2. Value used on property for tax purposes. the comparable properties to confirm the data
provided in the report.
Assessed value
Held review
75. Implies that no relationship exists between
the parties and that the buyer and seller each 88. Final step in the valuation process.
act in his or her own best interest.
Valuation report
Arms length transaction
89. Comparative approach that considers the
76. When successive element of one or more sales of similar or substitute assets and related
factor of production added to a fix amount of market data.
factor there is a resulting in income up to a point
of maximum return. Direct market comparison approach
Increasing and diminishing return 90. The distribution of the appraised value of the
property between land and building.
77. The often market measure of agriculture or
farm properties. Allocation
Per hectare 91. Involves calculating the cost of construction
by multiplying the square footage of the
78. A valuation review performed by a Valuer to structure by the construction cost for that
form an opinion as to whether the analyses, particular type of building.
opinions, and conclusions in the report under
review are appropriate, reasonable, and Square footage method
supportable.
92. Land that has been improved for specific
Technical review purpose.

79. The normal wear and tear that a building Site

experiences as it ages and it depends on the
original quality of construction and the level of 93. The process of converting into present value
ongoing maintenance. (or obtaining the present worth of) a series of
anticipated future periodic installment of net
Physical deterioration income. In real estate appraising, it usually takes
the form of discounting.
81. The key criterion in the valuation of real
property or personal property. Capitalization
Utility 94. It requires you to break down all the
components of a building and estimate the cost
82. Refers to one who is motivated, but not of the material and installation separately.
compelled to buy.
Quantity survey method
Willing buyer
95. Refers to the process of analyzing sets of
83. Tract of land divided into lots suitable for property and market data to determine the
home building. specific parameters of a model.

Subdivision Calibration

84. Value of superior property is adversely 96. The loss in value to any structure due to a
affected by the value of inferior property. variety of factors, such as wear and tear, age,
and poor location.
Regression
Depreciation
85. Difference between the value of the property
and current debt. 97. A mass appraisal process which facilitate the
appraisal of multiple properties at a given date.
Preparation and Application of SMV 111. Value a property holds to a specific person
who may use it for a specific purpose that's
98. Cost of constructing a structure with generally unavailable to the typical buyer.
comparable utility.
Value in use
Replacement
112. Value to a specific investor with a specific
99. Conditions and assumptions under which plan for the property.
appraisal is made.
Investment value
Limiting condition
113. Value used on property for tax purposes.
100. You never want to build a house that costs
100,000.00 on a piece of vacant land that costs Assessed value
500,000.00
114. All property value is created by
Balance the______of the future benefits the property will
provide.
101. Analyzes the future financial benefits of a
piece of real estate and converts it into an Anticipation
estimate of present value.
115. You never want to build a house that costs
Income approach 100,000.00 on a piece of vacant land that costs
500,000.00
102. Not part of the Approaches in valuing
historic properties. Balance

Income approach 116. The idea that nothing remains the same.

103. The difference between property value and Change

debt value.
117. If that building is a success other builders
Equity are likely to follow with more office buildings until
the last office building a builder erects remains
104. Estimate or opinion of value. partially vacant because the suppliers have
created a surplus of office space.
Appraisal
Competition
105. Employment and interest rate.
118. If you live in a neighborhood of single-
Economic Factors family houses, you don't want an office building
to be built across the street from your house.
106. Presence of pollutant in the area
Conformity
Environmental factors
119. Use that result in the highest value for that
107. The real estate location, size and condition property.

Physical Highest and best use

108. Demand for an aging population 120. The whole is sometimes greater than the
sum of its parts.
Social factors
Plottage
109. The value that appraisers deal with most
often.

Market value

110. Implies that no relationship exists between

the parties and that the buyer and seller each
act in his or her own best interest.

Arms length transaction

 REAL ESTATE FINANCE & 13. A tax is shifted forward to consumers if the
ECONOMICS demand is inelastic relative to supply

1. If demand rises ,the demand curve shifts to The statement is correct

the .
14. Refers to the flow of wages ^interest
payments dividends ,and other things of
Right
value accruing during a period of time .
2. The movement of prices will tend to go up
because of the higher demand. Income

15. Another element which affects the

Sellers market
movement of real estate
3. Real estate Economics tries to describe,
explain, and predict patterns of the demand side which is the buying
market & the availability financing,
prices, supply, and demand both for the production side or the
developers
4. Basically a result of the interplay of supply
and demand of a certain product, such as 16. Involves generally the acquisition of property
real estate housing. through loan financing sources

Price Real Estate Financing

5. A key determinant of demand 17. Refer to funds of the REIT that can be
placed in investment vehicles other than
Size of the market income generating real estate

6. Important kinds of market structures are Investible Funds

Monopoly, oligopoly, monopolistic 18. Means a corporation that directly or

and perfect competition . indirectly, through one or more
intermediaries, is controlled by, or is under
7. Take deposits and make loans; they are the common control of another corporation,
what most people think of as bank. which thereby becomes its parent
corporation.
Depository Institutions
Affiliate
8. Income payment to a REIT shall be subject
to a lower creditable withholding tax of 1%. 19. A very important formula for the computation
involving real estate financing is: MONTHLY
AMORTIZATION [ M A ] = Principal to be
Creditable Withholding Tax
financed x Amortization Factor
9. Failure to pay 3 consecutive monthly
amortizations and/or membership
contributions. TRUE
20. Refinancing must have at least 2 years
repayment history with current
Default
bank/institution
10. Must have at least 2 years repayment
history with current bank/institution TRUE

21. When demand is price inelastic ,a price

Refinancing
decrease and makes the total revenue
11. Refinancing must have how many years for
repayment history with current Reduces
bank/institution
22. The practice of charging different prices for
the same service to different customers
at least 2 years

12. The percentage change in quantity supplied Price Discrimination

divided by the percentage change in price
23. In pag-ibig, the six months interim insurance
and 2k processing fee is referred to
Price elasticity of supply
Deductions on the first loan release
Insurance
24. A financial institution that include brokers,
investment banks, under writers and mutual 36. In refinancing latest one year amortization
fund companies must reflect default is true

Securities firms No ,must not reflect default

25. Issue stocks and bonds to the corporate 37. Number of contribution in order that a
customers, trade them, and advise borrower eligible for pag-ibig loan.
costumers.
24
Brokers and investment banks
38. Not more than years old at the date of loan
26. The structure of the financial industry that application and must be insurable; provided
includes insurance companies, securities further, that he is not more than seventy (70)
firms, and mutual fund companies and years old at loan maturity.
pension funds.
65
Financial Institutions
39. Refers to a professional administrator of real
27. Which of the statement is not correct properties who is engaged by the REIT to
provide property management services and
Not all securities firms are very much lease management services.
in the business of producing
information Property Manager

28. If supply falls ,the supply curve shifts to the 40. Refinancing loan 5% of the loan amount
left, and retained to ensure cancellation of
mortgage/s prior to PAG-IBIG Fund is
referred to
Price rises and quantity goes down

29. The price at which quantity demanded Retail Accounts

equals quantity supplied.
41. Which of the statement is not true
Market equilibrium
Borrower will start the 3 construction
30. The application of economic techniques to if the total cost is lower than the
real estate markets. approval loan

Real estate economics 42. It is said that for every PI million invested in
housing it is translated to P16.6 million of
31. Simply means the effect of one aspect of the economic housing activity in the country
economy with the other economic activities.
TRUE
Multiplier effect of Real estate
43. Pag-ibig loan charges and deductions
32. The pag-ibig maximum loan amount. processing fee.

P6 Million P3,000.00

33. Pagibig Principal borrower's age shall not 44. Based on the Pag-ibig membership
exceed Contribution if the loan entitlement over PI.7
M to 1.8 M ,what will be the monthly
70 years old at date of loan maturity contribution ?

34. Whether or not the country provides equal 850

health care for all its residents ,health care
must be rationed because 45. Retail and Developer Accounts with
Transferred Titles Under Borrower's Name
Supply is limited (REM Accounts) referred as

35. Takes large individual risks and spreads Effects of default

them so broadly that they become
acceptable to a large number of individuals
46. To be paid upon filing of pag-ibig Housing
Loan Application, non-refundable 57. Loans over P400 to P3M maybe subject to
repricing
1,000.00
Every 3 years but not to exceed 2%
47. Is the largest insurance program from the original rate
Health care 58. To be deducted from the loan proceeds
Interim Mortgage Redemption
48. A REIT that owns land located in the Insurance
Philippines must comply with the foreign
ownership limitations imposed under the 59. Is a stock corporation established in
Philippine law. accordance with the Corporation Code of
the Philippines and the rules and regulations
Nationality Requirement promulgated by the Commission principally
for the purpose of owning income-
49. A REIT must have a minimum paid-up generating real estate assets.
capital of P300,000,000.00.
Real Estate Investment Trust
Capitalization
60. Properties with "Rights" instead of "Title" as
50. The spirit of unity, harmony, ramaradarip, proof of ownership.
appropriation and professional relationship
among the practitioners is essential, and NOT ALLOWED for Pag-IBIG Housing
shall be promoted under
Loan
The principle of solidarity 61. Real Estate Investment Trust Act of 2009
(R.A. no. 9856)
51. Net revenues, or the difference between
total sales and total costs.
An act providing the legal framework
Profits for real estate investment trust and for
other purposes
52. In the case where there are more buyers
than sellers, then it is considered a seller's 62. Use as an instrument to help finance and
market as there are fewer real properties develop infrastructure projects
available vis-a-vis a higher demand for it. In
this case, Capital Market

the movement of prices will tend to go 63. Pag-ibig monthly repayment shall not
exceed of the borrowers gross monthly
up because or' the higher demand
income for loans not exceeding PI,250,000.
53. The price of real estate has a tendency to go
down in view of the excess in supply vs. the 35%
actual demand of the market, is normally
referred to as 64. Minimum total stock public ownership of
shareholders in REIT
Buyers Market
50,000 shares
54. Penalty of the amount due for everyday of
delay of pag-ibig loan. 65. If a corporation builds a factory, it will
employ construction workers and their
suppliers as well as those who work in the
1/20 of 1%
factory. The statement best explains
55. The primary asset of modern commercial
banks, accounting for nearly two thirds of an effect in Economics
assets.
66. Refers to the total quantity of goods and
services that the nations businesses willingly
Loans
produce and sell in the given period.
56. Which statement is true
Aggregate Supply
Maximum of three qualified pag ibig
67. Which occurs because a good becomes
members may be tacked into a single relatively more expensive when its price
loan rises?
 financing sources, which may be sourced
Substitution effect from the following,except

68. The earnings in the market economy are Pilfering from Relatives/Friends
distributed to the owners of the economy7s
factors of production in the form of: 79. Deductions on the first loan release:

Wages ,profit, rent, and interest 6 months interim insurance and 2k

processing fee
69. Is by definition equal to price times quantity
(PxQ) 80. The 1st release of loan is based on lot value
or 40% of the approved loan whichever is
Total Revenue lower

70. Provides and sets of a domino effect on Incorrect

other economic activities which can be
referred to the "multiplier effect of real 81. When the price of a commodity is raised,
estate". buyers tend to buy less of commodity.

The housing or real estate sector Law of downward -sloping demand

71. Which of the following does not describe the 82. When there are changes in factors other
loans purpose than a good's own price which affect the
quantity purchased, we call these changes
Analyzes financial and economic
conditions ,both domestic and Shifts in Demand
international
83. Interim interest and advance one year
72. Which of the following statement is not true insurances.
about policy declaration
Deductions on final loan releases
Use the capital market as an
instrument to help finance only 84. NOT ALLOWED for Pag-IBIG Housing Loan

73. Basic borrower eligibility requirements Less than 28 sqm. Lot area

Not more than 65 years old upon filing, 85. Married individuals not legally separated and
cannot secure marital consent or Special
not more than 70 years old upon loan
Power of Attorney (SPA) from spouse is
maturity allowed for Pag ibig housing.
74. Shifts in the supply and demand curves
No
change the .
86. Revenues will increase when price
Equilibrium price and quantity
Decreases
75. An increased in supply, which shifts the
supply curve to the right , will
87. The pag-ibig ratio of the loan amount to the
appraisal value of the collateral up to
Decrease price and increase quantity 1,250,000.00
demanded
90%
76. Quantity supplied generally responds
positively to price ,so the supply curve is 88. REIT act of 2009

Upward-sloping RA 9856
77. Listed are the different depository 89. The loan amount retained to ensure
institutions except cancellation of mortgage/s prior to PAG-IBIG
Fund.
Insurance companies
5%
78. Real estate financing involves generally the
acquisition of property through loan 90. Income payment to a REIT shall be subject
to a lower creditable withholding tax of
1% 11.50%

91. Loan charges and deduction Processing 103. We mean the ultimate economic effect of
Fee of pag-ibig a tax on the real incomes of producers and
consumers by
P3,000.00
Incidence
92. To carry out the purposes of this Act the
Commission shall retain and use 50% of all 104. Percentage change in quantity demanded
fees paid to it, relative to the establishment greater than percentage change in price
of REITs and the registration of their
securities to annual budget. Elastic demand
Use of Registration Fees 105. In REIT, A fine of not less than P200,000
nor more than P5,000,000.00 or
93. Loan purpose is Refinancing of an existing imprisonment of not less than 6 years and 1
mortgage with home improvement day nor more than 21 years referred as
Penal Provision
Yes

94. For something to have value, it must first 106. What is the maximum loan term
have .
30 years
Utility
107. The shares of stock of the REIT must be
95. Even if a thing has utility, it will not have registered with the Commission and listed in
value if it is overabundant. accordance with the rules of the Exchange.

Scarcity Registration and Listing

96. Based on Pag-IBIG Membership 108. Government credit agencies that provide
Contribution if you have loan entitlement up loans directly for farmers and home
to 500,000 ,how much is the Monthly mortgagors.
Contribution?
Government-sponsored enterprises
200
109. The change in revenue that is generated
97. The sale or transfer of real property to by an additional unit of sales .
REITs, which includes the sale or transfer of
any and all security interest thereto, shall be Marginal revenue
subject to 50% of the applicable DST.
TRUE 110. The movement of prices will tend to go up
because of the higher demand
98. The largest source of wages, rents and
interest payment at every level form Sellers market
Government 111. Real estate Economics tries to describe,
explain, and predict patterns of
99. It tries to describe, explain, and predict
patterns of prices, demand and supply prices, supply, and demand
Real Estate Market Economy 112. Basically a result of the interplay of
supply and demand of a certain product,
100. The equilibrium price is also called such as real estate housing.

Market -clearing price Price

101. REIT distribute at least ________ of its 113. A key determinant of demand
distributable income as dividend.
Size of the market
90%
114. Important kinds of market structures are
102. What is the interest rate if the pag-ibig
loan amount is over P2M-P3.0M ?
Important kinds of market structures 67. Assets owned and/or controlled by
are governmental or quasi-governmental entities to
provide goods or services to the general public.
115. An increased in supply,which shifts the
supply curve to the right will Real property
Public sector assets
Real estate
Decrease price and increase quantity
Income generating assets
demanded
68. This concept is based on the notion that
The following statements are true when applied although two or more parcels of real estate may
to Valuation Standards except have physical similarities and closely resemble
Standards are statements of recognized one another, there may be significant
principles and concepts differences in how they can be used.
Standards prescribe specific methods of Value
valuation for different purposes Highest and best use
Standards are statement of best practice in Utility
procurement and reporting Substitution
Standards are statements of accepted
definitions 69. The approach to value perceives value as
created by the expectation of future benefits
62. The value of property to a particular investor, (income streams).
or a class of investors, for identified investment Cost approach
or operational objectives. Market data approach
Investment Value Allocation
Market value Income approach
Going concern value
Value in use 70. This approach to value recognizes that
property prices are determined by the market.
63. An amount above the Market Value that Market Value can, therefore, be calculated from
reflects particular attributes of an asset that are a study of market prices for properties that
only of value to a particular purchaser. compete with one another for market share.
Investment value Capitalization process
Plottage value Income approach
Value in use Cost approach
Special Value Market data approach
64. This is a form of ownership in which an 71. When data are available, this approach to
owner has an interest (usually fee simple) in a value is the most direct and systematic
certain unit defined such as the space between approach to estimating value.
the interior walls, the ceiling, and the floor of that Market data approach
unit and the owner also owns a pro rata share of Income approach
the common areas (drives, grounds, recreational Cost approach
amenities, etc.) within the development. Residual technique
Fee simple
Leased fee estate 72. Describes a valuation where an entire
Cooperative business is transferred as an operational entity.
Condominium Value in use
Investment value
65. An additional element of value created by Going concern value
the combination of two or more interests where Market value
the value of the combined interest is worth more
than the sum of the original interests. 73. This approach to value is also known as the
Market value contractor’s method, and is recognized in most
Synergistic value. countries.
Going concern value Market data approach
Investment value Asset based valuation
Income approach
66. The International Financial Reporting Cost approach
Standards adopt these two models for the
recognition of property assets in the balance 74. A form of real property, arising from the
sheet: contractual relationship between one who owns
Cost model and investment value model the property and one who typically receives a
Cost model and going concern value model non-permanent right to use the property in return
Cost model and value in use model for rental payments or other valuable economic
Cost model and fair value model consideration.
Lease interests
Fee simple
Freehold explicit assumptions regarding the prospective
Condominium income and expenses of a property or business.
Annuity method
75. In business valuation, this approach may be Discounted cash flow analysis
similar to the cost approach used by appraisers Direct capitalization
of different types of assets. Investment method
Residual technique
Market data approach 83. A type of review undertaken to ensure that a
Asset-based approach valuation meets or exceeds the compliance
Income approach requirements or guidelines of the specific market
and, at a minimum, conforms to Generally
76. Specific materials that, by their presence or Accepted Valuation Principles of the Philippine
proximity, may have adverse effect on property Valuation Standards.
value because of their potential to cause harm to Administrative review
life-forms. Field review
Non-fruit bearing trees Desk review
Informal settlers Technical review
Fully depreciated buildings and improvements
Hazardous and toxic substances 84. The rights and privileges granted to the
owner of intangible assets.
77. The current cost of replacing an asset with Bundle of rights
its modern equivalent asset less deductions for Personal property
physical deterioration and all relevant forms of Tangible property
obsolescence and optimization. Intangible property
Quantity survey method
Reproduction cost 85. A valuation review that is limited to the data
Cost to cure presented in the report, which may or may not
Replacement cost be independently confirmed.
Desk review
78. Refers to the loss in value of an asset Technical review
resulting from wear and tear over time, including Field review
any lack of maintenance. Administrative review
Functional obsolescence
Economic obsolescence 86. This theory involves the concept that land
Deferred maintenance cannot be valued under one highest and best
Physical deterioration use while the improvements are valued based
on another highest and best use.
Anticipation
79. Refers to loss in value that can be caused by Contribution
advances in technology that result in new assets Balance
being capable of a more efficient delivery of Consistent use
goods and services.
Physical deterioration 87. Refers to a housing program and projects
Functional obsolescence covering houses and lots or homeless only
Economic obsolescence undertaken by the government or the private
Deferred maintenance sector for the underprivileged and homeless
citizens.
80. A charge against a property in which the Socialized housing
property is security for payment of a debt is Low cost housing
called a Bliss project
mortgage. Subdivision development
escheat.
restriction. 88. A valuation review performed by an
lien appraiser to form an opinion as to whether the
analyses, opinions, and conclusions in the report
81. The Enchanted Kingdom theme park in Sta. under review are appropriate, reasonable, and
Rosa has had a significant impact on uses of supportable.
land in its vicinity for many years and an Administrative review
influence on the value of that land. Which of the Desk review
four forces does this represent? Field review
Governmental Technical review
Economic
Social 89. These are individual properties, such as
Environmental hotels, fuel stations, and restaurants that usually
change hands in the marketplace while
82. A financial modeling technique used in the remaining operational.
income approach to value that is based on Specialized properties
Institutional properties
Trade related properties 97. In property markets, this represents the
Public sector assets quantity of property interests that are available
for sale or lease at various prices in a given
90. A revenue-raising procedure, based on the market within a given period of time, assuming
assessed value of property related to a scale of labour and production costs remain constant.
charges defined by statute within a specified Supply
time-frame. Demand
Estate taxation Desirability
Gross income taxation Purchasing power
Ad valorem taxation
Capital gains taxation 98. In property markets, this constitutes the
number of possible buyers or renters seeking
91. In mass appraisal, this is the process of specific types of property interests at various
analyzing sets of property and market data to prices in a given market within a given period of
determine the specific parameters operating time, assuming other factors such as population,
upon a model. income, future prices, and consumer
Calibration preferences remain constant.
Standard deviation Demand
Mode Efficient market
Range Active market
Supply
92. The practice of appraising multiple
properties as of a given date by a systematic 99. This economic principle holds that value is
and uniform application of appraisal methods simply a function of the present worth of future
and techniques that allow for statistical review benefits.
and analysis of results. Principle of substitution
Grid analysis Principle of contribution
Multiple regression Principle of anticipation
Mass appraisal Principle of highest and best use
Valuation process
100. Public sector land valuation and taxation in
93. Represents the ownership interest of a the Philippines is the domain of two (2) arms of
lessor owning real estate that is subject to lease the government, namely:
to others. Land Registration Authority and Bureau of
Bundle of rights Internal Revenue
Partial interest Department of Budget and Management and
Leased fee estate Local Government Units
Leasehold fee estate Local Government Units and National Tax
Research Center
94. Any form of lease rental arrangement in Local Government Units and Bureau of
which the lessor receives a form of rental that is Internal Revenue
based on the earnings of the lessee. Percentage
rent is an example.
Base rent 101. Related to the property itself, this principle
Market rent holds that value is achieved and maintained
Economic rent when all elements are in proper proportion.
Turnover rent Principle of increasing and decreasing returns
Principle of balance
95. Rights generally inherent in the ownership of Principle of contribution
real estate include are referred to as Principle of conformity
Lease interests
Bundle of rights 102. This economic principle holds that as time
Property rights and market conditions change, so does supply
Real property and demand for real estate, and thus, the value
of real estate.
96. At the most fundamental level, value is Principle of progression or regression
created and sustained by the interrelationship of Principle of substitution
five factors that are associated with any product, Principle of anticipation
service, or commodity. These factors are – Principle of change
Utility, scarcity, desire, purchasing power,
and transferability 103. This economic principle holds that a
Utility, need, purchasing power, buyers and prudent purchaser would pay no more for a
sellers home than it would cost him or her to build or
Location, size, shape, terrain and elevation buy another one.
Capital markets, money markets, discount rate Principle of substitution
and reserve requirements Principle of conformity
Principle of balance
Principle of contribution
 and related market data, and establishes a value
104. A valuation review that includes inspection estimate by processes involving comparison.
of the exterior and sometimes the interior of the Market data approach
subject property and possibly inspection of the Development technique
comparable properties to confirm the data Cost approach
provided in the report. Income approach
Desk review
Technical review 112. The process of orchestrating land, labor,
Administrative review and capital to produce an item.
Field review Conduction
Analysis
105. It is defined as that logical, legal, and most Entrepreneurship
probable use which will yield the greatest net Capitalization
income to the land over a sustained period of
time. 113. The forces that impact real estate values
Interim use are the following:
Existing use Social, economic, physical or environmental
Actual use and governmental
Highest and best use Physical, economical, sociological and
Correct answer physiological
Highest and best use Political, economical, governmental and physical
Population, income level, skill levels and social
106. An ______________ market is one that is environment
characterized by goods or services that are
easily produced and readily transferable, with a 114. These forces relate to trends in society or
large number of buyers and sellers. culture, and sometimes these forces are
Calm imagined while at other times they are based on
Efficient actual facts and figures.
Active Social
Inefficient Governmental
Environmental
107. This theory is based on the idea that the Physical
greater the volume of an item, the less each
incremental volume should cost. 115. A / An ______________________ is a
Increasing returns group of complementary land uses.
Anticipation Area
Economies of scale Zone
Cheaper by the dozen Neighborhood
Municipality
108. The surplus productivity principle
recognizes the four agents of production, which 116. In the application of this technique to
are estimate value, the building value is estimated
Land, buildings, other land improvements and as the present value of the residual income
machinery attributable to the building of an income
Plant, machinery, equipment and technology producing property.
Land, buildings, labor and capital Land residual technique
Land, labor, capital and entrepreneurship Development technique
Building residual technique
109. In any enterprise, labor must be paid first, Property residual technique
with capital paid after that, entrepreneurship is
then paid. The residual income is attributed to 117. The term used to describe the connecting
the land (including buildings). This concept of complementary uses to the homogenous land
applies in what economic principle affecting uses (zone) is
values? right-of-way.
Balance Passage.
Contribution road network.
Economies of scale linkage.
Surplus productivity
118. Neighborhoods and zones alike generally
110. This term means coordination or exist in one of four life cycle stages; these are –
management. growth, stability, decline, and revitalization.
Capital growth, stability, renovation, and rebirth
Labor growth, stability, decline and rebuilding
Entrepreneurship growth, decline, reconstruction, and
Production revitalization

111. This comparative approach considers the 119. These are assets that embody a cultural,
sales or offers of similar or substitute properties historic, and/ or architectural heritage.
Historic properties Market data approach, sales comparison
Trade related properties approach and offers
Agricultural properties
Public sector assets 127. The analysis of an environment of
buyers/sellers and/or landlords/tenants
120. The initial stage in a neighborhood or (lessors/lessees).
zone’s life cycle. This refers to the period in Marketability study
which the neighborhood or zone is expanding Investment analysis
and developing. Market study
Growth Feasibility study
Revitalization
Decline 128. Type of market analysis that addresses the
Stability time required to absorb a particular product, and
the price or rent level at which that product
121. When a neighborhood can no longer would be accepted into the marketplace.
compete with other comparable neighborhoods, Market study
it usually enters the _________________ stage Feasibility study
of its life cycle. Marketability study
Growth Investment analysis
Revitalization
Stability 129. A ____________ study is simply a
Decline comparison of cost versus the value if the
project is undertaken.
122. The act of distinguishing or delineating Investment analysis
markets that the appraiser should consider in his Marketability study
data program is called Market study
market analysis. Feasibility study
market segmentation.
market segregation. 130. A study undertaken for the purposes of
market study. development and investment, the evaluation of
investment performance, or the analysis of a
123. In this type of market, goods and services transaction involving investment properties.
are not readily produced or easily transferable, Market study
with no readily identified group of buyers and Economic base study
sellers active in a particular marketplace. Investment analysis
Buyer’s market Feasibility study
Seller’s market
Efficient market 131. A mortgage secured by a group of
Inefficient market properties or a number of lots.
Blanket mortgage
124. The study of a specific market. It is the Lein
collection and dissection of data and the Simple mortgage
conversion of that data to information that can Mechanic’s lien
be used for analysis and decision-making by an
appraiser or analyst. 132. If the contract rent and the market rent are
Feasibility study equal, the Leasehold or Lessee’s Interest is
Market analysis _______________, assuming there is no
Marketability study leasehold improvement.
Investment analysis Positive lease
Negative lease
125. A rate of return used to convert a monetary Zero
sum, payable or receivable in the future, into Balanced
present value. Theoretically it should reflect the
opportunity cost of capital, i.e., the rate of return 133. This comparative approach to value
the capital can earn if put to other uses having involves the cost of acquiring equivalent land
similar risk. and constructing an equivalent new structure.
Overall rate Builder’s method
Discount rate Cost approach
Internal rate of return Market data approach
Investment rate Income approach

126. The three types of market analysis are: 134. In operating lease, the value of the
Investment analysis, economic base analysis, Lessee’s Interest is estimated as the present
monetary analysis value
Market study, marketability study and of rental payment plus reversion value of the
feasibility study property at the end of the lease agreement
Statistical study, market study and of rental gain or loss plus reversion value of the
demographics study leasehold improvement, if any
of rental gain or loss and the value of the 142. A real estate mall developer purchases a
leasehold improvement, if any site with the intent of building a regional mall
of rental payment for remaining life of the lease because the immediate area has a significant
agreement number of households and the income level of
those households is affluent. What type of force
135. A _____________________ leasehold is the neighborhood going through?
interest is created when the contract rent is Governmental
higher than the current market rent. Economic
Zero Environmental
Equal Social
Positive
Negative 143. Specific characteristics of properties and
transactions that cause the prices paid for real
136. A group of homogenous land uses. estate to vary.
Neighborhood Units of comparison
Municipality Comparable data
City Comparable sale prices
District Elements of comparison

137. Typically, a factor produced by two 144. Method of estimating the reproduction cost
components, which reflects precise differences or replacement cost that combines the direct
between properties and facilitates analysis in the and indirect costs into a single unit-in-place
three approaches to value, e.g., price per square amount, which when multiplied by the unit
meter or square foot, or the ratio of a property’s measure of the improvement’s component will
sale price to its net income (net income yield the cost of the component.
multiplier/years’ purchase). Index or trending
Units of comparison Comparative
Physical characteristics Quantity survey
Comparable data Unit-in-place
Elements of comparison
145. The cost of replacing an asset with an
138. The cost to create a virtual replica of the equally satisfactory substitute asset; normally
existing structure, employing the same design derived from the current acquisition cost of a
and similar building materials. similar asset, new or used, or of an equivalent
Quantity survey method productive capacity or service potential.
Reproduction cost, new Unit-cost-in place
Unit-cost-in-place method Reproduction cost
Replacement cost, new Replacement cost
Builder’s method
139. The current cost of a similar new item
having the nearest equivalent utility as the item 146. The Subic Freeport Zone is one of the
being appraised. largest developments in Central Luzon. What
Replacement cost, new force does this represent?
Unit-cost-in-place method Governmental
Quantity survey method Social
Reproduction cost, new Environmental
Economic
140. An asset which has a similar function and
equivalent productive capacity to the asset being 147. The process by which a least cost
valued, but of a current design and constructed replacement option is determined for the
or made using current materials and techniques. remaining service potential of an asset.
Public sector asset Value engineering
Modern equivalent asset Reproduction cost, new
Reproduced asset Capitalization
Replacement asset Optimization

141. The process of adjusting the replacement 148. Method of estimating the reproduction cost
cost to reflect that an asset may be technically or replacement cost that involves the adjustment
obsolete or over engineered, or the asset may of the original costs to current costs by a
have a greater capacity than that required.99. multiplier derived from published cost indexes.
This economic principle holds that value is Comparative
simply a function of the present worth of future Unit-in-place
benefits. Quantity survey
Optimization Index or trending
Reproduction cost, new
Capitalization 149. Type of lease which involves the transfer
Value engineering ownership from lessor to lessee.
Leased fee
Operating lease 158. The period of time over which the
Leasehold fee components of the improvement may
Financing lease reasonably be expected to perform the functions
for which they were designed.
150. Lose in property value are caused by Remaining life
deterioration or obsolescence Economic life
Deferred maintenance Used life
Cost to cure Useful life
Depreciation
Replacement cost 159. The age indicated by the condition and
utility of a structure
151. The difference between the cost to Actual age
reproduce or replace a property and its present Used life
value Effective age
Replacement cost Chronological life
Depreciation
Cost to cure 160. A method of estimating depreciation that
Regression involves the development of a depreciation
estimate by studying sales of comparable
152. Major causes of depreciation are the properties that have depreciated to a similar
following except degree as the improvement.
External obsolescence Component method
Physical deterioration Observed condition method
Deferred maintenance Market extraction method
Functional obsolescence Cost to cure method

153. Refers to the wear and tear from regular 161. A method of estimating depreciation
use and the impact of the elements whereby the appraiser estimates the total
Functional obsolescence economic life expectancy of the existing
Adverse market condition structure as well as its effective age, based on
External obsolescence an analysis of sales of similar structures
Physical deterioration Market extraction method
Component method
154. Method of estimating reproduction or Age-life method
replacement costs by applying the average or Observed condition method
typical comparative cost (per square-meter cost)
of similar improvements. 162. The estimated period from the actual age of
Index or trending method a component to the end of its total useful life
Quantity survey method expectancy.
Unit-in-place method Remaining economic life
Comparative method Remaining useful life
Actual age
155. This cost estimate envisions constructing a Effective age
structure of comparable utility, employing the
design and materials that are currently used in 163. An impairment of the utility or salability of
the market. an improvement or property due to negative
Quantity survey method influences outside the property.
Unit-in-place method Adverse market condition
Replacement cost Economic obsolescence
Reproduction cost Functional obsolescence
Physical deterioration
156. The period of time over which
improvements contribute to property value. 164. Sometimes called historical age or
Useful life chronological age, is the number of years that
Lifespan have elapsed since building construction was
Economic life completed.
Remaining life Remaining useful life
Actual age
157. Lose in value caused by a flaw in the Remaining economic life
structure, materials, or design that diminishes Effective age
the function, utility, and value of the
improvement 165. A method of estimating the reproduction
Deferred maintenance cost or replacement cost that involves a
Functional obsolescence complete cost itemization of all direct and
Economic obsolescence indirect cost to be incurred or incurred in the
Physical deterioration construction of an improvement.
Quantity survey method
Index method
Cost-in-place method 174. Financial vehicles with traditional maturities
Comparative method or investment periods of less than one year.
Cash deposits
166. Primarily used to allocate a known amount Capital markets
of total depreciation, estimated by either the Time deposits
market extraction method or the age-life method, Money markets
into its components
Market extraction method 175. In the income approach to value,
Breakdown method reconstructed operating statements specify that
Age-life method the income projection is subject to the
Component method assumption that the property is run by a / an
inefficient operator.
167. The process of retiring a mortgage or debt expert competent management.
over a specified time period. average competent management.
Debt service substandard management.
Installment
Equity 176. Financial vehicles with usual maturities of
Amortization more than one year.
Money markets
168. Represents the money earned for the right Cash deposits
to use capital. Capital markets
Equity Time deposits
Principal amount
Amortization 177. In this technique the land value is
Interest estimated as the present value of the residual
income attributable to the land of an income
169. Also known as debt service. producing property.
Amortization Development technique
Equity Building residual technique
Installment Discounted cash flow analysis
Payment Land residual technique

170. Credit regulation devices that the Bangko 178. A loan for personal property and secured
Sentral ng Pilipinas can use to regulate the by personal property.
supply of money. Liens
Lending rates and amortization rates Blanket mortgages
Capitalization rates and mode of payments Chattel mortgage
Production of new bills and disposal of old bills Real estate mortgage
Discount rates and reserve requirements

171. The government’s management of 179.

revenues (taxes) and expenses (appropriations) ______________________________________
is called __ specify that the income projection is subject
monetary policy to the assumption that the property is run by a
repayment policy reasonably efficient operator or average
credit policy competent management.
fiscal policy Operating statements supplied by client
Operating statements reconstructed by the
172. The Philippines’ fiscal policy is managed by internal auditor
the Operating statements reconstructed by the
Bangko Sentral ng Pilipinas appraiser
Department of Finance Operating statements supplied by agent of client
Department of Budget and Management
Department of Justice 180. The process of converting an income
stream into value.
173. The estimated amount for which a property, Investment analysis
or space within a property, should lease on the Market analysis
date of valuation between a willing lessor and a Capitalization
willing lessee on appropriate lease terms in an Depreciation
arm’s-length transaction, after proper marketing
wherein the parties had each acted 181. The resulting amount of reducing the
knowledgeably, prudently, and without annual potential gross income by a vacancy
compulsion allowance amount.
Market rent Effective gross income
Leased fee Gross profit
Contract rent Effective net income
Rental rate Net operating income
182. Operating expenses are deducted from the Remaining useful life
effective gross income to determine the Remaining economic life
annual depreciation of the property. Actual age
annual net profit for the property.
annual gross profit for the property. 190. A method that is used to build a
annual net operating income for the capitalization rate using just two components;
property. financing and equity.
Build-up method
Gross income multiplier method
183. Process of converting income into value by All risks method
dividing a single year’s stabilized net operating Band of investment method
income, by an all risks rate. Correct answer
Yield capitalization Band of investment method
Discounted cash flow analysis
Valuation approach 191. Defines the percentage number used to
Direct capitalization determine the current value of a property based
on estimated future operating income.
184. In the application of the discounted cash Buying rate
flow analysis to operating real properties, the Selling rate
value of the property is estimated as the net Capitalization rate
present value of Absorption rate
The value of the business at the end of the
projection period. 192. Acquisition of private land by the
The reversion value, anticipated at the end of government for public use could be undertaken
the projection period. thru the following procedures, except
The series of periodic net operating incomes, Foreclosure
along with an estimate of the reversion Expropriation
The series of periodic net operating incomes. Exchange or barter
Negotiated sale or purchase
185. Profit-making entities operating to provide
consumers with products or services.
Real property 193. A _________________ leasehold interest
Public sector asset is created when the market rent is greater than
Financial interests the contract rent.
Businesses Equal
Negative
186. A credit regulation device of the BSP that Zero
refers to the percentage of deposits that must be Positive
retained by banks.
Discounted rates 194. The rate that equates the present value of
Fiscal policy the net cash flows of a project with the present
Reserve requirement value of the capital investment.
Credit regulation Overall rate
Recapture rate
187. In the application of the discounted cash Discounting rate
flow analysis to development properties, the Internal rate of return
value of the properties is estimated as the
present value of the
The series of net cash flows that are discounted 195. This rate reflects both the return on the
over the projected development invested capital and the return of the original
The series of periodic net operating incomes. investment, which are basic considerations of
The series of periodic net operating incomes, potential investors.
along with an estimate of the reversion Discounting rate
The series of dividends and the value of the Overall rate
business at the end of the projection period. Recapture rate
Internal rate of return
188. This capitalization process considers the
time value of money, and is applied to a series
of net operating incomes for a period of years. 196. The rent specified by a given lease
Discounted rate arrangement.
Internal rate of return Economic rent
Yield capitalization Rental rate
Direct capitalization Market rent
Contract rent
189. The estimated period over which existing Correct answer
improvements are expected to continue to Contract rent
contribute to property value
Effective age
197. The following are standard tests for highest years, with no funds withdrawn. In 5 years, the
and best of real property, except amount in the investment fund is
physically possible P268,058.
financially feasible P267,645.
maximally productive P260,000.
politically permissible P200,000.

198. Applicable to real estate improvements, the Transfer tax must be settled ________ from the
rate warranted by prudent investors that will execution of the deed of sale, barter or donation
represent the return on investment (usually the or any other mode of transfer of ownership.
interest rate or capitalization rate) and the return 90 days
of investment, for improvements, this is 60 days
represented by the recapture rate.99. This 3 months
economic principle holds that value is simply a 120 days
function of the present worth of future benefits.
Discounting rate
Recapture rate What type of bias form a sample selection bias
Internal rate of return in financial databases?
Overall rate Time-period Bias
Data-mining Bias
199. Interest Rate + Recapture Rate equals Survivorship Bias
Discounting rate Sample-Selection Bias
Internal rate of return
Overall rate
Return on investment A 7-year old residence is currently valued at
P720,000. What was the original value if it has
A comparable lot was recently sold at P5,000 appreciated by 60% since it was built?
/sqm. The subject is superior in terms of location P450, 000
by 20%. What is the estimated MV of the subject P432, 000
property? P102, 857.14
80% None of the above
P1000
GN 14 of PVS 2009
P5000
None of the above
P6000
Mass Appraisal for Property Taxation
IVS 500 Bases other than Market Value
Development Property Business Valuation
Intangible Assets
An appraisal is to be made for a three bedroom
Financial instruments
house. One comparable with two bedrooms is
Real Property Interests
sold for Php5,000,000.00. The appraiser makes
The dwelling house including the land on which an adjustment of Php500,000.00 to the
it is situated, where the husband and wife or an comparable to account for the difference in the
unmarried individual, whether or not qualified as number of bedrooms. The adjusted sales price
head of family, and members of his family of the comparable is:
reside. Php6,500,000.00
Half-way House Php4,500,000.00
Ancestral House Php5,500,000.00
Principal Residence Php6,000,000.00
Domicile
It is fundamental to the operation of International
It is a type of sale where a buyer takes over the Valuation Standards that valuation performed in
loan responsibility and obligations of a seller. compliance therewith should be provided by
Junior mortgage ________________ professional valuers.
Cash Sale Good Reputation and Religious
Seller Financing Honest and Competent
Assumption of Existing Loan Good Morals and Right Conduct
Prestigious, Organized and Popular

The most commonly used capitalization rate is A commercial property type used to maintain or
The overall rate occupy professional or business offices.
The income rate Usury Property
The composite capitalization rate Mall Property
The interest rate Agricultural Property
Office Property
Magandang for Kalooban Company will invest
P200,000 today. The investment will earn 6% 5 ____________ are those that need a particular
site for a very specific purpose and are prepared
to pay extra to get the particular site that gives
them the exposure they need _________ is the actual amount spent to build
Auction Sale Purchasers or put an property into being.
Open Market Sale Cost
Special Purpose Purchasers Discount
Forced Sale Purchasers Price
Value

Machinery which are considered of

006 -F- Real Estate _______________ purpose shall not be
considered within the definition of machinery.
Appraiser - Government Special
Assessment and Tax - 67 General
Restricted
item Specific

Property Tax on real estate is calculated by what ________ is the percentage applied to the fair
method? market value to determine the taxable value of
Multiply the tax rate by the assessed value the property.
Dividing the assessed value by the tax rate Tax Rate
Divide the tax rate by the most probable sales Assessment Level
price Tax Discount
Multiply the tax rate by the most probable sales Tax Incentive
price
_______ are lands in which minerals, metallic or
__________ is a levy on real property non-metallic exist in sufficient quantity or grade
determined on the basis of a fixed proportion of to justify the necessary expenses to extract and
the value of the property. utilize such materials
Withholding Tax Mineral Lands
Transfer Tax Dumpsites
Excise Tax Regalian Lands
Ad Valorem Tax War Zones

___________ is a highly accurate method of __________ is the estimated period over which
field operations for identifying real property units, it is anticipated that machinery or equipment
defining property boundaries, determining actual may be profitable utilized.
use and discovering undeclared properties for Depreciable Life
taxation. Commercial Life
Data gathering Economic Life
Brokering Actual Life
Investigation Correct answer
Tax Mapping Economic Life

________ is the code used to refer to a property _________ is the numbering system used in
whether it is Land, Building or Machinery. Real Property Records to make possible the
Classification Code accounting of every parcel of land.
Kind Code Tax Identification Numbering System (TIN)
Use Code Tax Declaration Numbering System (TDN)
Update Code All of the above
Property Index Numbering System (PIN)
The DOF through the _______ shall be
responsible for the supervision of the revenue Real property declared for the first time shall be
operations of LGUs with the end in view of assessed for the period during which it would
making them less dependent on funding from have been liable but not more than ______
the national government. years back, based on the applicable SMV in
Bureau of Internal Revenue force during the corresponding period.
Bureau of Customs none of the above
Bureau of Local Government Finance 15 years
Bureau of Treasury 10 years
5 years
__________ machinery shall include machines,
_______ is an act or process of determining the
equipment, appliances or apparatus
value of a property as of a specified date for a
permanently attached to residential land and
specific purpose.
improvements not movable by destination.
Brokering
Agricultural
Selling
Residential
Assessment
Industrial
Appraisal
Commercial
 ________ is the remaining value after deducting
________ is land devoted principally to industrial depreciation from the acquisition cost.
activity as capital investment and is not Economic Value
classified as agricultural, commercial, timber, Salvage Value
mineral or residential land. Depreciated Value
Socialized Housing Land Networth
Urban Housing Land
Industrial Land ________ is the fair market value of a real
Economic Zone property multiplied by the assessment level and
is synonymous to taxable value.
The Board of Assessment Appeals shall be Tax Collectible
composed of the Registrar of Deeds as Assessed Value
Chairman and the provincial or city prosecutor Tax Due
and provincial or city _________ as members. Discounted Value
Assessor
Engineer _____________ is the amount required to
Accountant acquire a similar new asset having the nearest
Treasurer equivalent utility as the property being
appraised.
__________ refers to power generating Reproduction Cost New
equipment found in power plants and water Acquisition Cost
treatment equipment found in water treatment None of the Above
plants.Untitled Question Replacement Cost New
Agricultural Equipment
Industrial Equipment In cases of cities, the distribution of proceeds of
Utility Company Equipment the Basic RPT under Section 271 of RA 7160
Building Equipment shall be ________ (for city (GF)– barangay).
50% -50%
_______ is land principally devoted to 60% - 40%
habitation. 80% - 20%
Residential Land 70% - 30%
Habitable Land
Economic Land A uniform rate of basic real property tax not
Natural Habitat exceeding ______ of the Assessed Value shall
be levied in the case of provinces.
_________ is the code used in the Assessment 1.5%
Records to identify the kind of transaction made. 1.25%
Use Code 1.0%
Update Code 1.75%
Kind Code
Classification Code A tract of land with an area of 5 hectares was
recently sold for P500 per square meter. What is
In the case of municipality within the MMA the estimated land value?
(Pateros), the distribution of proceeds of the P2,500,000
Basic RPT shall be _________ (for MMA (GF) – P1,250,000
municipality(GF) – barangay) P25,000,000
30% - 35% - 35% P250,000
35% - 35% - 30%
40% - 35% - 25% ________ is the act or process of determining
40% - 30% - 30% the value of a property or proportion thereof
subject to tax, including the discovery, listing,
__________ is the period of time expressed in classification, and appraisal of properties.
years from the date of appraisal to the date Tax Mapping
when the machinery becomes valueless. Discovery
Recovery Life Assessment
Remaining Economic Life Valuation
Salvageable Life
Worthless Life __________ includes elevators, escalators,
gensets, pumps, airconditioning units and
For purposes of assessment, a depreciation ventillating equipment.
allowance shall be made for machinery at a rate Mechanical Equipment
not exceeding _____ % of the original cost for Agricultural Equipment
each year of use. Building Equipment
20% Industrial Equipment
5%
15% ___________ is the most detailed method in
10% estimating the costs of reproducing a building as
part of the cost approach to value.
Breakdown Method year of its purchase plus the cost of
Comparative Method transportation, handling and installation at the
Quantity Survey Method present site is referred to as the _____________
Unit-in-place Method .
Reproduction Cost
________ is land devoted principally for the Syndicated Cost
object of profit and is not classified as Acquisition Cost
agricultural, industrial, mineral, timber or Landed Cost
residential land.
Subdivision Land Under Section 220 of RA 7160, the local
Rawland assessor shall make a classification, appraisal
Resort and assessment of the real property listed and
Commercial Land described in the declaration irrespective of any
previous assessment in cases where
______ is the actual amount paid to a particular _________
transaction. A request is made by the person in whose name
Cost the property is declared.
Price All of the above
Value There is ongoing general revision of property
None of the above classification and assessment of real properties
Real property is declared for the first time
__________ is the price at a which a property
may be sold by a seller who is not compelled to For urban lands, the standard scale to be
sell and bought by a buyer who is not compelled considered in the preparation of the base map
to buy. shall be ________ .
Assessors Value 1:100 to 1:5000
Fair Market Value 1:100 to 1:2000
Zonal Value 1:200 to 1:5000
Taxable Value 1:500 to 1:10000

_______ of RA 7160 provides for the appraisal If the assessed value of the property is
and assessment of machineries for real property P300,000 after applying the assessment level of
tax purposes. 20%, what is the estimated market value?
Section 218 P600,000
Section 217 P1,000,000
Section 210 P500,000
Section 224 P1,500,000

For agricultural machineries, the Assessment _________ is land devoted principally to the
Level to be applied to the FMV to determine the planting of trees, raising of crops, livestock and
Assessed Value shall be fixed by an ordinance poultry, dairying, salt making, inland fishing and
at the rates not exceeding _______ similar aquacultural activities and other
40% agricultural activities, and is not classified as
50% mineral, timber, residential, commercial or
80% industrial land.
60% Industrial Land
Agricultural Land
A province or city or a municipality within the Raw land
MMA, may levy an annual tax on idle lands at Landgrabbed Land
the rate not exceeding _______ of the AV of the
property which shall be in addition to the basic _________ is the assigning of new assessed
real property tax. values to property, particularly real estate, as a
5.0% result of a general or partial revision or individual
1.5% reappraisal of the property.
1.0% Restoration
2.0% Recalibration
Retirement
In cases of provinces, the distribution or Reassessment
proceeds of the Basic RPT under Section 271 of
RA 7160 shall be ________ (for province(GF) – Guidance Note No. _____ of the PVS provides
municipality(GF) – barangay). for the standards in valuing plant, machinery and
35% - 40% - 25% equipment in the Philippines.
40% - 35% - 25% 1
35% - 35% - 30% 2
40% - 30% - 30% 4
3
The actual cost of a newly-acquired machinery
not yet depreciated and appraised within the
Machine is a device while _______________ is
a classification of the property which consists of The value of a property does not remain
physical facilities that are available for constant.
production designed for manufacturing and CHANGE
industrial purpose. CONTRIBUTION
Machinery & Equipment REGRESSION
Buildings & Other Building Structures PROGRESSION
Land & Land Improvements
Special Purpose Properties Effect on the value of property based on some
future event.
___________ is the technique used to compute REGRESSION
the Replacement Cost New under the Cost CONTRIBUTION
Approach which involves inquiring from PROGRESSION
manufacturers, suppliers and dealers and ANTICIPATION
applying the unit price to the item.
Indexing An owner adds a 4th bedroom to her home and
All of the above realizes a significant gain in property value. The
Repricing addition of a 5th bedroom a year later results in
Calibration only a modest increase in value.
REGRESSION
A property’s value is diminished by P50,000 PROGRESSION
because it lacks a garage. CONTRIBUTION
CONTRIBUTION INCREASING AND DIMINISHING BALANCE
REGRESSION
HIGHEST AND BEST USE After reviewing a property, a buyer decides that
PROGRESSION its greatest value could be realized if a strip mall
were built on it.
Effect of an improvement on a property’s value. HIGHEST AND BEST USE
HIGHEST AND BEST USE CONTRIBUTION
REGRESSION PROGRESSION
PROGRESSION REGRESSION
CONTRIBUTION
Correct answer A homeowner’s property value suffers because
CONTRIBUTION it is next to a house that has become rundown.
PROGRESSION
A prospective buyer believes a suburb will be REGRESSION
passing a rent control ordinance. HIGHEST AND BEST USE
ANTICIPATION CONTRIBUTION
CONTRIBUTION
PROGRESSION A property’s value passes through a renewal
REGRESSION phase.
CONTRIBUTION
The maximum value of a property is equal to the CHANGE
cost of purchasing an equally desirable property REGRESSION
REGRESSION PROGRESSION
PROGRESSION
CONTRIBUTION A property owner’s house is worth approximately
SUBSTITUTION the same as other similar houses in the block.
REGRESSION
Combining lots to increase the value of the new CONTRIBUTION
larger lot over the sum of the smaller ones. PROGRESSION
REGRESSION SUBSTITUTION
CONTRIBUTION
PLOTTAGE A developer decides to assemble four adjacent
PROGRESSION lots so that an office building can be built.
REGRESSION
Process of merging lots. PLOTTAGE
PROGRESSION PROGRESSION
REGRESSION CONTRIBUTION
CONTRIBUTION
ASSEMBLAGE / CONSOLIDATION The one legal use that provides its greatest
value.
The value of a poorer property will increase if it REGRESSION
is near a better quality property. PROGRESSION
CONTRIBUTION CONTRIBUTION
REGRESSION HIGHEST AND BEST USE
PROGRESSION
HIGHEST AND BEST USE
Property values change as these two forces Estimates the price by the highest bidder,
adjust themselves in the real estate market. benefits to investor and its advantages.
REGRESSION
PROGRESSION Estimates the value from past sales data, zonal
SUPPLY AND DEMAND valuation, and asking prices.
CONTRIBUTION Estimates the Price that would be achieved,
the benefits, and that would be agreed.
The value of a property is maximized if it is used Estimates the price from classified ads, interview
in the same way as neighboring properties. with owners, brokers and assessors.
HIGHEST AND BEST USE
REGRESSION Special value can arrive where an asset has
CONFORMITY attributes that make it more attractive to a
PROGRESSION particular buyer than to the general body of
buyers in the market. These attributes are;
A homeowner’s property value benefits because The asset has special desirability, profitability
it is next to a house that recently has been and best use.
renovated. Ecological, socialized, financial and market
REGRESSION characteristics of an asset.
PROGRESSION Physical, geographic, economic and legal
HIGHEST AND BEST USE characteristics of an asset.
CONTRIBUTION The asset’s characteristics are that of liquidity,
profitability and desirability.
The value of a better property will decrease it it
is near a poorer quality property. The __________ Standards of Series 200,
HIGHEST AND BEST USE describes the common different purposes for
PROGRESSION which valuation are required, relate to the IVS
REGRESSION General Standards and set tout any specific
CONTRIBUTION valuation requirements for each purpose.
Local
What would best differentiate Fair Value as General
against Market Value? Application
That Fair Value connotes a broader concept. International
The Fair Value does not take into account the
prospective advantages. How is the purpose of the valuation determined?
That Fair Value is the price to be paid for. By the Valuation Methodology.
The Market Value needs to disregard an arm’s By the Valuation Objective and Basis of
length transaction. Value.
By the Valuation General Principles.
The term __________ is often used in By the Set of the Standards required in the
circumstances where the seller is under valuation.
compulsion to sell and a proper marketing
period is not available. ___________ is the estimated amount for which
Motivated Sale an asset should exchange on the date of
Total Sale valuation between a willing buyer and willing
Forced Sale seller in an arm’s length transaction after proper
Discount Sale marketing where the parties had each acted
knowledgeably, prudently and without
Many valuations may require the use of different compulsion.
Bases of Values that are define by; Market Value
___________. Liquidated Value
Statements, Conditions, Laws and Regulation. Sound Value
Objectives, Methods, and Terms of Reference. Hypothetical Value
Ownership, Rights, and Asking prices.
Stature, Regulation, Private Contract or other As a matter of Practical Expectancy, it is normal
document. for limits to be agreed on the extent of the
Valuer’s investigation. Any such limits shall be
What Approach of Valuation utilizes depreciation recorded on the ___________.
or replacing the asset to reflect obsolescence in Scope of Work
order to estimate the value of the asset when Covering Letter
there is no direct sales evidence is available? Objective
Market Approach Limiting Conditions
Income Approach
Cost Approach The International Valuation Standards Board
Hypothetical Development Approach (IVSB) achieves the objectives ________means.
By setting up schools and colleges teaching
IVS recognizes and defines Bases of Values in Valuation Arts & Science.
each of three principal categories namely; By promoting the Code of Ethics and Standards.
By developing, promoting and monitoring Determine the special circumstances of the
the International Valuation Standards. seller.
Circumstances do not exist at the valuation date
By issuance of licenses and permits to practice that there must be clearly identified as special
valuation. assumption.

_____________ is the value of an asset to the The Basis of Value and its Objective which
owner or a prospective owner. determines the valuation is known to be the
Cost Value __________ of the valuation.
Economic Value Contract
Investment Value Engagement
Market Value Purpose
Meaning
International Valuation Standard 104 sets out
the Minimum Matters that should be addressed To ensure that the valuation report is properly
at the outset of a valuation assignment. What supported, the Appraiser needs to gather
term would best describe this required sufficient evidence by such means as;
standard? Google maps, calls to brokers, request of client.
Scope of Work Pictures, research materials and judgement.
Introduction Inspection, inquiring, computation and
Overview of the Report analysis.
Qualification of the Appraiser Ocular entry, interviews, opinion of buyers and
sellers.
The extent of the investigation is necessary to .
gather ____________. Which of these valuations do not form part of
Sufficient Evidence Asset Standards of IVS 300 series?
Listings Valuation of Property Investment.
Pictures Valuation of Plants & Equipments.
Data Valuation of Future Value.
Valuation of Business Interest.
The Concept of Market Value presumes a price
negotiated in a _________ market were the The standards of IVS apply to Assets and
participants acted freely. ________.
Private and Negotiable Properties
Closed and Favorable Land
Open and Competitive Liabilities
Semi-public and Limited Equity

The Purpose of the Valuation determines the A Basis of Value should be clearly distinguished
valuation objectives and in turn, the _________ from except;
of value. The Approach or Method used to estimate
Computation value.
Data The Actual or Assumed state of an asset at the
Example point of valuation.
Basis The Type of Asset to be valued
The Hypothetical and Assumptions to
Market value should be in accordance with the General Circumstances.
following conceptual framework except;
Estimated amount of an eager or forced What is the objective of the International
seller. Valuation Standards Board?
Estimated value on the date given. Council of International Valuation Standards
Estimated amount by a willing seller. Council of Standards and Valuations
Estimated amount that an asset should International Organization of Valuation Council
exchange. International Valuation Standard Council

___________ is the perceive life over which an What would best determine a valuation to
asset is expected to be available for use by an ensure the information obtain is adequate.
entity. Information from buyers and sellers
Useful Life Professional Judgement
Remaining Life Information from brokers
Depreciated Life Information City Assessors
Economic Life
The IVS set or framework for valuation practice
In order to obtain Forced Sale Value the explains High Level of Principles and
following are required except; Terminologies to help Valuers attain
Identify the reasons for the contract seller. consistency. However, the 2010 Edition does
Need to set a specified period by setting out not:
appropriate assumptions.
Describes different types of Valuation The procedures that will be adopted,
Objectives. assumption that would be made and the
Identify generally accepted Valuation limitations, restrictions and conditions that
Approaches. will apply before the valuation and report are
Give instructors on how to estimate value finalized.
Describes general accepted Valuation The procedure adopted as required by the client.
Concepts.
The determination of Highest and Best Use
It is necessary to gather sufficient evidence by involves considering the following except;
such means except; Economic and Social Impact.
Inspection Establish whether a use in possible.
Using old reports That the use be Financially Feasible.
Inquiring That it be Legally Permissible.
Computation and Analysis
The differences between the Investment Value
The other standards of IVS 2010 Edition is on an Asset with its Market Value is provided by
structured and organized into 100 series except; the?
IVS 104 Scope of Work Motivation for Buyers or Sellers to enter the
IVS 105 Valuation Reporting Market Place.
IVS 103 Bases of Value The conditions between a willing buyer and a
IVS 111 Equity and Liabilities willing seller.
The conditions of the cost of the asset and its
International Valuation Standards 201.01 or Fair Investment Feasibility.
Value under International Reporting Standards The situation that a seller needs to sell and a
contains the following except; buyer needs to buy.
Aggregation, Valuation Hierarchy
Fair Value Measurement, Application of _______________ is the standard – setting
Liabilities body of the International Valuation Standard
Pictures of the property, Market Value Council (IVSC).
Report, Objective of the Study The International Body of Standard Valuation
Scope of Work, Valuation Reporting The International Valuation Standard Board
International Valuation Standard Organization
What best inputs provide guidance on the The International Standard Organization
background of particular valuation requirements
that should be considered as stated in the A ______________ assumption is an
General Standards of IVS 200 Series assumption that either assumes facts that differ
Application Standards? from the actual facts existing at the valuation
The scope of work, Undertaking and Report date, and that would not be made by a typical
Writing. market practice input.
The Objective, Ocular Inspection, and Subjective
Judgement or Opinion of Value. Special
The engagement letter, Study and Report. Objective
The Letter of the Client, Inspection of the Hypothetical
Property and Study.
As a matter of Practical Expectancy, it is normal
The standards of IVS 2010 Edition, is structured for limits to be agreed on the extent of the
and organized into 100 series except; Valuer’s investigation. Any such limits shall be
IVS 101 – General Concepts of Principles. recorded on the ___________.
Liabilities IVS 110 Classified Ads
IVS 103 – Bases of Value Client or third party
IVS 102 – Valuation Approach Zonal and/or assessed values
Co-owners or neighbors
___________ in the estimated price for the
transfer of an asset or liability between identified The 200 series of the IVS or Application
knowledgeable and willing parties the reflects Standards includes the following except;
the respective interest of those parties. Valuation of Art and Intangibles. IVS
Liquidated Value 201.0123
Economic Value Valuation of Property, Plants, & Equipments in
Fair Value Public Sector IVS.201.05
Sound Value Valuation for Depreciation IVS 201.02
Fair Value under International Final Reporting
What contents in an Appraisal Report would you Standards IVS 201.01
consider important as part of the scope of work?
The procedure that is use to set limiting What organization or body is responsible for the
condition, qualification of the appraiser, and date standard setting of the international valuation
of inspection. standard council (IVSC)?
The Methodology Used, Terms of Reference The International Valuation Standard Board
and Introduction. (IVSB)
The International Valuation Standard Objective Appraised
(IVSO) Intended
The Valuation Standard Organization (VSO) Required
The International Body of Standard of Valuation Estimated
(IBSV)
A ____________ is a statement of the
___________ is the estimated amount that an Fundamental Measurement Assumptions of a
entity would currently obtain from disposal of an Valuation.
asset. Definition of Value
Reciprocal Value Limiting Conditions
Scrap Value Standards of Value
Market Value Basis of Value
Liquidation Value
__________ is additional element of value
created by the combination of two or more
Market value of an asset will reflect its interest where the value of the combined interest
_____________. is worth more than the sum of the original
Optimal and Profitable Use interest.
Flexible and Creative Use Interest in absolute value
Highest and Best Use Economic Value
Acceptable and Future Use Synergetic Value
Total Value
The International Valuation Standards Board
Members are appointed by what council?
International Valuation Standard Council
Council of International Valuation Standards
Council of Standards and Valuations 1. If a property’s net income ratio is 0.80, what is
International Organization of Valuation Council its operating expense ratio?
2.00
The International Valuation Standards (IVS) are 0.20
designated to except; 0.02
To promote the convergence of existing 0.80
Valuation Standards.
To issue licenses, certificate, and organize 2. An office building was recently sold for
seminars. P60,000,000.
To identify and promulgate common principles Given the following information:
for undertaking valuation.
To promote consistency and aid to Gross potential income : P12,000,000
understanding of valuation. Vacancy factor : 10%
Expenses : 45% of effective gross
___________ is the amount that reflects income
particular attributes of an asset that are any of Annual mortgage payment : P4,500,000
value to a special purchaser. Equity : P12,500,000
Special Value
Market Value What is the equity dividend rate or cash-on-cash
Fair Value rate of return?
Economic Value 7.48%
11.52%
The ____________ Standards of IVS 300 series
7.50%
describes the matter that influences the value of
12.00%
different types of properties, how the principles
in the General Standards are applied to their 3. For the office building above and the same
valuation. information, what is the over-all rate of return for
Property the
Business property?
Asset 12.00%
Trade 8.58%
7.50%
In an _________, transaction is one between
9.90%
parties who do not have particular or special
relationship. 4. If the land value in a subdivision has
Asking Price increased by 12% during the past year and the
Force Liquidation average price of land sold last year was P
Arm’s Length 1,560,000, what is the average price of land sold
Accretion today?
P 1,372,800
As a General Principle a valuation must be
P 1,572,500
appropriate for its ___________ purpose.
P 1,716,000
P 1,747,200 11. A building has a rental income of P 60,600
per month. Using an annual gross rent multiplier
5. A commercial property producing an annual of 15, the value of the building would be
gross income of P768,500 was sold two months estimated at _______
ago for P5,620,000. What is the property’s gross P 10,800,000
income multiplier? P 10,908,000
7.50 P 909,000
7.31 P 727,200
8.50
7.40 12. The value of a property consisting of land
and building with an annual net operating
6. What is the value of a property with a building income of P330,000 and with an overall
value of P2,400,000, a land capitalization rate of capitalization rate of 12.50% is
8.0%, building overall rate of 14% and net P 2,640,000
operating income of P545,000? P 2,750,000
P 4,012,000 P 2,400,000
P 6,812,500 P 2,570,000
P 4,921,000
P 5,012,500 13. Which of the following estimates would result
in a capitalization rate of 8%
7. To adjust the sale price of a comparable sale Property value of P 4,000,000, net operating
with a 10% better location, you should income of P 320,800
Add 10% to the sale price of the comparable Property value of P 2,500,000, potential gross
Subtract 10% from the price of the subject of income of P 200,000
appraisal Property value of P 2,500,000, effective gross
Multiply the sale price of comparable by 10% income of P 200,000
Subtract 10% from the sale price of the Property value of P 2,500,000, net operating
comparable income of P 200,000

8. Subject of appraisal is a 4-bedroom house.

Based on the following paired data gathered, 14. The property subject of appraisal is 15%
what would be estimated value of the subject of superior to the subject of a comparable sale.
appraisal? The comparable was sold for P2,212,000, what
is the indicated value of the subject?
Market data: P 1,923,500
3-bedroom house was recently sold for P P 2,602,400
6,455,000 P 2,543,800
2-bedroom house was recently sold for P P 1,880,200
6,250,000
15. An office building has depreciated by 50%
P 6,455,000 since it was built 25 years ago. If it would cost
P 6,660,000 P39,200,000 to build today, and if similar sites
P 6,600,000 are for P 25,000,000, what is the estimated
P 6,665,000 market value of the property today?
P 54,600,000
9. A residential house was constructed in 2001 P 48,520,000
for P 12,568,000. The cost index published at P 64,200,000
that time was 178.20. The current cost index P 44,600,000
from the same cost reporting service is 360.70.
What is the current indicated reproduction cost Assume the following:
of the residential house?
P 25,349,000 Annual net operating income of the property : P
P 25,316,000 1,100,000
P 25,136,000 Land value : P 4,500,000
P 25,439,000 Interest rate : 8%
Recapture rate : 4%
10. What is the indicated value of a 6-year-old
building with a floor area of 360 square meters, 16. What is the property value by the building
if the current cost of construction of similar residual technique?
buildings is P15,000 per square meter of the P 11,666,667
floor area, and the estimated depreciation of the P 10,666,667
building is 2% per year? P 9,666,667
P 4,572,000 P 12,666,667
P 4,752,000
P 5,752,000 17. Mr. B owns a parcel of land leased to Mr. C
P 5,400,000 at an annual rental rate of P1,000,000. The
lease has a remaining life of 6 years. What is the
present value of the rentals if the interest rate is
10% per year? Present worth factor for annuity 24. A 30-year mortgage covering 75% of
is 4.35526 and lump sum is 0.56447. property value can be obtained from a bank for
P 1,771,561 8.5%. The mortgage constant is 0.092. Equity
P 3,386,820 for this type of property requires 12% return.
P 4,355,260 10.00%
P 1,771,573 9.00%
9.90%
18. A building was constructed 10 years ago and 10.50%
is well maintained that based on the observation
of the appraiser its condition is similar to other 6- 25. What would be recapture rate of a building
year-old buildings. The effective age of the having a remaining economic life of 12 years
building is 8.33%
16 years 8.00%
10 years 88%
4 years 112%
6 years
26. In a property residual capitalization
19. A building was constructed 10 years ago and approach, what is the value of an improved
is well maintained that based on the observation property with a net income of P180,000 a year,
of the appraiser its condition is similar to other 6- an interest rate of 8% and a recapture rate of
year-old buildings. The actual age of the building 2%?
is P 1,500,000
16 years P1,800,000
6 years P 2,250,000
10 years P 3,000,000
4 years
27. A house and lot is priced at P7,500,000. The
20. The reproduction cost new of a commercial lot alone is valued at P2,531,250. What is the
building is estimated to be P80,000,000. The percentage of the total asking price is attributed
building should have an economic life of 50 to the house?
years, and it is now five years old. However, 33 1⁄4 %
based on the observation of the appraiser its 66 1⁄4 %
effective age is similar to other 10-year-old 33 3⁄4 %
building due to poor maintenance. What is its 66 3⁄4 %
value of the building (exclusive of land value)?
P 75,000,000 28. A vacant lot is rented for a car display for
P 80,000,000 P24,000 per month. The interest rate applicable
P 64,000,000 to this type of property is 8%. Compute the value
P 72,000,000 of the property by income approach.
P3,600,000
21. A 10-year-old building is currently valued at P2,600,000
P7,200,000. What was its original value if it has P2,400,000
appreciated by 60% since it was built? P2,800,000
P 4,320,000
P 4,500,000 29. If a particular buyer requires a recapture of
P 5,142,900 the building portion of the price in 30 years, what
P 2,880,000 is the indicated recapture rate of the building?
3 1⁄4%
22. The appropriate adjustment for time is 3 1⁄2%
determined to be 8% per year. The time 3 1/3%
adjustment for a comparable property that was 3%
sold a year ago for P10,000 per square meter is
Less P 800 per square meter 30. Mr. A is leasing a 60-square meter
Less P 1,000 per square meter commercial space for P3,000 per square meter
Plus, P 1,000 per square meter per year. Research indicate that similar space
Plus, P 800 per square meter has a going market rate of P3,200 per square
meter per year. What is the rental gain realized
23. A lessee is renting a commercial space with by Mr. A per year?
a base rent of P7,000 per month plus 5% of the P 1,200
gross sales exceeding P100,000 per month. The P 24,000
lessee’s gross sales last year was P1,600,000. P 2,400
How much rent was paid last year? P 12,000
P 104,000
P 114,000 31. A house and lot is priced at P8,800,000. The
P 84,000 lot alone is valued at P1,650,000. What
P 184,000 percentage of the total asking price is
attributable to the value of the lot?
18 1⁄4 %
19.0 % Given the above information, what is the
18 3⁄4 % indicated value based on the comparable
18.5 % property?
P1,325,000
32. A property with an annual net income of P1,293,860
P336,000 was sold for P4,200,000. The P1,300,000
remaining life of the building is 40 years. Land P1,232,250
value is P1,200,000. What is the overall rate for
the property? 38. What is the reversion value of a property
6.00% with an estimated market value of P12,540,000
8.00% 2 years from now at an interest rate of 10% per
9.00% year?
7.00% P 15,173,400
P 10,363,635
33. A comparable land was sold a year ago for P 15,048,000
P30,000 per square meter. Its location is P 10,157,40
considered 15% inferior and its shape and
topography is 10% superior to the subject site. 39. A comparable property is identical to the
The time adjustment is 3% per year. Determine subject property being appraised. The
the adjusted sale price of the comparable site. comparable was sold six months ago for
P 38,400 per square meter P1,000,000. As the appraiser, you must make
P 32,400 per square meter an adjustment for the time difference between
P 29,400 per square meter the subject property and the comparable. You
P 30,600 per square meter have found a paired sale of two houses, one of
which was sold one year ago for P800,000, and
34. A property with an annual net operating the other sold yesterday for P880,000. What is
income of P336,000 was sold for P4,200,000. the proper estimated adjusted sales price for
The remaining life of the building is 40 years. your comparable?
Land value is P1,200,000. What is the value of P1,100,000
the building? P1,000,000
P 2,500,000 P1,050,000
P 3,000,000 P880,000
P 3,500,000
P 2,000,000 40. If a property has a net income ratio of 0.75
and a gross income multiplier of 9, what is the
35. A property was sold for P60,000,000. Using indicated over-all capitalization rate?
the rule-of thumb of building-to-land ratio of 4:2, 8.33%
what is the value of the building? 2.78%
P 40,000,000 12.00%
P 30,000,000 6.75%
P 20,000,000
P 50,000,000 41. Corporation T is to lease a parcel of land for
1 year at P2,000,000. Research indicate that
36. A 10-year old residential apartment has a similar land has a market rent of P2,200,000 per
reproduction cost of P6,250,000, broken down year. What is the estimated value of the
into P 2,500,000 representing the structural leasehold interest if the rental payment is to be
component, and P 3,750,000 for the other paid as a lump sum amount today and the
component. Yearly allowance for ordinary interest rate is 10%?
structural deterioration is 2%, while the P 181,818
depreciation rate for the curable component is P 200,000
5% per year. Economic obsolescence result in a P 180,000
rental loss of P60,000 per year. What is the P 220,000
estimated value of the building?
P 3,275,000 42. A commercial structure is a rectangle with
P 3,875,000 sides of 80 meters and 145 meters and the
P 5,150,000 current local cost to build a similar structure is
P 3,775,000 P18,500 per square meter. What is the
estimated construction cost of the structure?
37. A comparable property sold six months ago P 214,600,000
for P1,250,000. Market investigation indicates P 208,800,000
the following: P 215,600,000
P 218,600,000
Location adjustment : +5%
Time adjustment : +6% Questions nos. 43 to 45 are based on the
Age adjustment : -7% following information:
Building Value : P50,000,000
Net Operating Income : P8,350,000
Building Capitalization Rate : 14%
Land Capitalization Rate : 9%

43. What is the residual income to the land?

P 3,850,000
P 4,500,000
P 1,350,000
P 70,000,00

44. What is the value of the land?

P 9,642,850
P 42,777,750
P 4,500,000
P15,000,000

45. What is the total value of the property?

P 59,642,850
P 92,777,750
P 65,000,000
P 54,500,000
APPRAISAL & ASSESSMENT IN THE ordinance grants a 20% discount, imposing
GOVERNMENT SECTOR 1% for the basic tax and 1% for the SEF.
EXERCISES NO. 1 a. P 13,000.00
b. P 13,800.00
c. P 12,000.00
Multiple Choice. Choose the correct answer d. P 12,800.00
(your answers in Italic and Bold Fonts)
Solution:
1. The Municipal Assessor was taxing an idle Basic Tax = P800,000 x 1% = P8,000
agricultural land consisting of 12 hectares SEF = P800,000 x 1% = P8,000
valued at P50 per square meter. If the idle Total Tax = Basic Tax + SEF = P16,000
land tax imposed is 5% by the ordinance, Discount = P16,000 x 20% = P3,200
how much will the owner pay for the idle land Annual Realty Tax Due = P16,000 – P3,200 =
tax? P12,800
a. P 60,000.00
b. P 120,000.00 5. Compute the total annual realty tax due for
c. P 200,000.00 the following given data.
d. P 300,000.00 Lot area : 270 sqm
FMV : P1,500.00
Solution: Classification : Agricultural
Total Area = 12has x 10,000sqm/has = 120,000 Location : Province
sqm a. P 3,240.00
Total Value = 120,000 x P50/sqm = P6,000,000 b. P 1,620.00
AV = P6,000,000 x 40% = P2,400,000 c. P 4,860.00
Idle Land Tax = P2,400,000 x 5% = P120,000 d. P 8,100.00
2. Lot 18, a real property located in the Solution:
province, has an assessed value (AV) of MV = 270sqm x P1,500/sqm = P405,000
P10,000.00. Compute the annual realty tax AV = P405,000 x 40% = P162,000
due if the LGU’s tax ordinance provides for Basic Tax = P162,000 x 1% = P1,620
the imposition of 1% basic tax and 1% SEF. SEF = P162,000 x 1% = P1,620
a. P 300.00 Total Tax = Basic Tax + SEF = P3,240
b. P 200.00
c. P 100.00 6. How much will be the quarterly payments for
d. P 150.00 SEF tax will have to be made by the owner if
he owns a residential lot values by the City
Solution: Assessor at P2,000,000 where the basic tax
Basic Tax = P10,000 x 1% = P100 rate is 2%.
SEF = P10,000 x 1% = P100 a. P 8,000
Annual Tax Due = Basic Tax + SEF = P200 b. P 2,000
c. P 4,000
3. Compute the annual realty tax due if the real
d. P 1,000
property has an assessed value of P
500,000.00, RPT payment in up to date, tax
Solution:
payer pays in full January 20 of the current
MV = P2,000,000
year and the local tax ordinance provides of
AV = P2,000,000 x 20% = P400,000
a 1% basic tax, 1% SEF and a 10% discount
SEF = P400,000 x 1% = P4,000
for up-to-date realty payments.
Quarterly Payments = P4,000/4 = P1,000
a. P 15,000.00
b. P 14,000.00
7. A 2.5 hectare agricultural idle land with a
c. P 10,000.00
market value of P 100.00/sq.m. was taxed by
d. P 9,000.00
the municipal assessor. How much idle land
tax shall be imposed if the idle land tax rate
Solution:
is 4.0% as per ordinance?
Basic Tax = P500,000 x 1% = P5,000
a. P 20,000.00
SEF = P500,000 x 1% = P5,000
b. P 40,000.00
Total Tax = Basic Tax + SEF = P10,000
c. P 50,000.00
Discount = Total Tax x Discount Rate
d. P 100,000.00
Discount = P10,000 x 10% = P1,000
Annual Realty Tax Due = Total Tax - Discount
Solution:
Annual Realty Tax Due = P10,000 – P1,000 =
Total Area = 2.5has x 10,000sqm/has = 25,000
P9,000
sqm
Total Value = 25,000 x P100/sqm = P2,500,000
4. Compute the amount a taxpayer will pay for
AV = P2,500,000 x 40% = P1,000,000
advance payment of realty tax for the
Idle Land Tax = P1,000,000 x 4% = P40,000
forthcoming year if the assessed value of the
property is P 800,000.00 and the enabling
8. Lot 29, a piece of real property located in the MV = 2has x 10,000sqm/has x P100/sqm =
city, has an assessed value (AV) of P2,000,000
P20,000.00. Compute the total annual realty
tax due if the city tax ordinance provides for No Road -9
the imposition of 2% basic tax and 1% SEF. All weather -8
a. P 600.00 Local trading center -6%
b. P 400.00 Total Adjustment -23%
c. P 200.00
d. P 150.00 Adjusted MV = P2,000,000 (100%-23%) =
P1,540,000
Solution:
AV = P20,000 12. What will be the share of the host barangay if
Basic Tax = P20,000 x 2% = P400 he contributes P 150,000.00 basic property
SEF = P20,000 x 1% = P200 tax in his municipality?
Total Tax = Basic Tax + SEF = P600 a. P 25,000
b. P 37,500
9. Mr. Mamalateo purchased a vacant lot in a c. P 52,500
respectable subdivision in Angeles, City in d. P 60,000
1999. In 2004, he decided to build a house
on that vacant lot but didn’t declare the Solution:
improvement he made to the City Assessor’s Basic Property Tax = P150,000
office of Angeles. The Assessor conducted Brgy Share = P150,000 x 25% = P37,500
an audit in 2022 and asked Mr. Mamalateo to
pay the back taxes from 2004 to 2022. How 13. Montreal Farm is a contract grower of San
much real property tax should Mr. Miguel Corporation and uses tunnel
Mamalateo pay on its improvement ventilated poultry equipment. The value of its
assuming the fair market value of his house equipment is P 5,000,000.00. Yearly,
is =P= 1,500,000.00? Montreal is liable to pay how much real
a. P 157,500 property taxes on its equipments?
b. P 168,680 a. P 30,000
c. P 294, 840 b. P 40,000
d. P 525,500 c. P 50,000
d. 100,000
Solution:
AV = P1,500,000 x 35% = P525,000 Solution:
Basic Tax = P525,000 x 2% = P10,500 AV = P5,000,000 x 80% = P4,000,000
SEF = P525,000 x 1% = P5,250 Basic Tax 1% = P40,000
Total Tax = Basic Tax + SEF = P15,750
Realty Tax Due = P15,750 x 10yrs back taxes 14. The city assessor was taxing an idle
(max.) = P157,500 commercial land consisting of 1,500 sqm
valued at 12,000 per sqm. If the idle land tax
10. Assuming the Municipality of Pateros imposed is 4% by the ordinance, how much
collected a total Real Basic Property Tax of will the owner pay for the idle land tax?
P4,000,000.00 in the year 2010. How much a. P 360,000.00
fund/budget will be given to the MMDA the b. P 288,000.00
following year? c. P 720,000.00
a. P 1,200,000 d. P 144,000.00
b. P 1,400,000
c. P 2,600,000 Solution:
d. P 2,800,000 Total Value = 1,500sqm x P12,000/sqm =
P18,000,000
Solution: AV = P18,000,000 x 50% = P9,000,000
Total Property Tax = P4,000,000 Idle Land Tax = P9,000,000 x 4% = P360,000
MMDA Share = P4,000,000 x 35% = P1,400,000
15. Mrs. Garcia has 5 hectares of uncultivated
11. What will be the market value of a parcel of ricefield in Nueva Ecija for which she failed to
agricultural land measuring 2 hectares with pay its annual real property tax for 2 years.
no road outlet and is over 9 kms away from In addition to its RPT, she was also
all weather road and local trading center with assessed to pay an idle land tax at the rate
SMV of 100 per sqm. of 3%. Assessed value of her ricefield is P
a. P 1,540,000 2,500,000.00. What will be her total
b. P 2,000,000 payments for this property?
c. P 460,000 a. P 370,000.00
d. P 200,000 b. P 250,000.00
c. P 50,000.00
Solution: d. P 400,000.00
Solution: 2. The assesses value of the real property is
AV = P2,500,000 P 230,000.00. Compute the realty tax dues, if
RPT = P2,500,000 x 2% = P50,000 the basic tax rate is 1% and SEF is 1%.
Idle Land Tax = P2,500,000 x 3% = P75,000 a. P 1,370.00
Total Realty Tax = RPT + Idle Land Tax = b. P 2,370.00
P50,000 + P75,000 = P125,000 c. P 3,370.00
Back Taxes = P125,000 x 2years = P250,000 d. P 4,370.00
Interest = P250,000 x 2% x 24months =
P120,000 Solution:
Total Due = P250,000 + P120,000 = P370,000 Total Tax = P230,000 x 2% = P4,600
Quarterly Tax Dues = P4,600/4 = P1,150
16. What will be the total basic real property
taxes to be paid by a lot owner if his land 20. Mr. Rex Montero is paying his realty taxes on
consisting of 500 sqm. has a fair market April 28 for the 1st and 2nd quarters of the
value of the assessor at P10,000 per sqm current year (2023). The assessed value of
and is classified as commercial? The tax rate the real property is P 550,000.00. Compute
is the maximum imposable by the city. the 1st and 2nd quarter realty tax dues only
a. P 100,000 and interest, if the basic tax rate is 1% and
b. P 25,000 SEF is 1%.
c. P 50,000 a. P 5,445.00
d. P 40,000 b. P 4,554.00
c. P 4,445.00
Solution: d. P 5,554.00
MV = 500sqm x P10,000/sqm = P5,000,000
AV = P5,000,000 x 50% = P2,500,000 Solution:
Basic Tax = P2,500,000 x 2% = P50,000 Total Tax = P550,000 x 2% = P11,000
Quarterly Tax Dues = P11,000/4 = P2,750
17. What is the monthly penalty interest on the Tax Due = P2,750 x 2quarter = P5,500
basic real estate taxes in case one fails to
pay the tax due last year on a lot of 500 sqm
classified as commercial and valued by the
assessor at P2,500 per square meter with a 21. Compute the basic real property tax of the
basic tax rate of 2% and special fund tax rate lot owned by the private school located at
of 1%? province with an assessed value of
a. P 250.00 P3,500,000.00
b. P 12,500.00 a. P0
c. P 18,750.00 b. P35,000.00
d. P 375.00 c. P70,000.00
d. P5,100.00
e. NOTA
Solution:
MV = 500sqm x P2,500/sqm = P1,250,000 Solution:
AV = P1,250,000 x 50% = P625,000 Tax Due = P0 (exempt)
Annual Realty Tax = P2,500,000 x 3% =
P18,750 22. An idle agricultural land consisting of 2
Penalty = P18,750 x 2% per month = P375 hectares valued at P200/sq.m. was taxed by
the municipal assessor. If the idle land tax
18. Mrs. Marlyn Ledesma would like to pay her imposed is 5% by the ordinance, how much
realty tax due for the current year. She will should the owner pay as idle land tax?
pay the four quarters in full on October 10. a. P40,000.00
The assessed value of the property is b. P80,000.00
P150,000.00. Compute the total tax due if c. P100,000.00
the basic tax rate is 1%, SEF 1%. d. P200,000.00
a. P 3,420.00
b. P 3,375.00 Solution:
c. P 3,540.00 Total Value = 2has x 10,000sqm/has x
d. P 3,375.00 P200/sqm = P4,000,000
AV = P4,000,000 x 40% = P1,600,000
Solution: Idle Land Tax = P1,600,000 x 5% = P80,000
Annual Realty Tax = P150,000 x 2% = P3,000
Penalty = P3,000 x 2% interest x 9months = 23. Compute the assessed value and basic tax due
P540 the city government of a lot where a residential
Total Tax Due = P3,000 + P540 = P3,540 house of Mr. Juan Dela Cruz is situated.
Location : Jose Abad Santos St., Davao
19. Mrs. Dianna Pama would like to pay her City
realty tax due for the current year (2023). Lot Area : 200 sq.meters
She will pay in full the four quarters on May SFMV : P2,000/sq.m
 Solution:
Total Value = 200sqm x P2,000/sqm = P400,000
AV = P400,000 x 20% = P80,000
Basic Tax = P80,000 x 1% = P800

24. Ana has a farm in Atok, Benguet. The farm

currently has an assessed value of
P345,000.00. The province of Benguet imposes
a 1% basic real property tax rate. In 2013, she
left the country without paying her current Real
Property Tax. She only paid all of her Real
Property tax obligations when she came back on
March 1, 2016. How much should she pay?

Solution:
Annual Tax Due = 345,000 x 2% = 6,900
Total Tax Due = 6,900 x 3yrs = P20,700 (see
section 270 LGC)
 39. One way of getting the amount to be financed by the buyer in the pur
contract price minus downpayment
Real estate finance and 40. Cash payment is not considered a real estate financing method in the
economics a high end subdivision compared to the following: In house financing, ba
financing
41. If financing was made in the amount of 18% interest per annum, the m
applied on a 24 months payment scheme is 1.5% per month (Because 18
1. Economic activities which emphasize harvesting or extracting materials from
42. The the ground
maximum ageor seafor
limit would
the maturity of payment of the loan from
be placed in the primary sector of the economy unit is 70 years old
2. The secondary sector of the economy manufactures finished goods43. An additional requirement in obtaining a loan which is to pay off the l
3. Economic activities which emphasize metal working and smelting, automobile
upon the death production, chemicalis mortgage redemption insurance
of the borrower
and engineering industries, aerospace manufacturing, energy utilities,44. engineering,
A paymentbreweries
scheme whereand the buyer of the condo unit pays the total p
bottlers, construction and shipbuilding would be placed in the tertiarytime without interest is referred to as deferred cash payment
4. The quartenary sector of the economy in the service industry. 45. In the Philippines multiplier effect of real estate is referred to as the
5. Economic activities which include government, culture, libraries, scientific
the other research,
economiceducation,
activitiesand
of the country
information would be placed in the quartenary sector of the economy46. An index used in the Philippines is the multiplier effect of real estate w
6. The quinary sector of the economy which includes the highest levels in of
thedecision
followingmaking in a society or
ratio 1:16.6
economy 47. The downpayment made by the buyer can be computed by using the
7. The quinary sector would include the top executives or officials in such fieldsprice
contract as government,
minus amount science,
financed
universities, nonprofit, healthcare, culture and the media. 48. Diego borrowed money from his brother to buy a lot and borrowed P
8. Among the three types of economic systems, subsistence type is the one that
payable in 2emphasizes the
years. The interest monthly is P 12,500 (Because 15% divide
production of goods and services principally for the producer’s family1,000,000)
and relatives (
Commercial type; and Planned type) 49. Freddie was paying a monthly amortization of P 54,100 per month at
9. Quarrying and Mining are pairs of sub-sectors of the primary sector that are grouped
amortization factorcorrectly
is 0.02705 tothe
be amount being financed is P2,000,000 (
identified as extractive industries divided by amortization factor yields the total financed amount)
10. In economic development, economic factor indicators are availability 50. Inofaconsumer goods, worker
housing financing scheme based on diminishing balance, interest
productivity, access to raw materials, economic structure, and per capitapaymentincomeof principal increases
11. In determining the Quality of Life (QOL), it is based on indicators of
51. Loan value is referred to as the amount of property used as a basis fo
physical environment can be given.
12. Deferred maintenance is a cause which lowers property values.
13. Demand can be comprised by the following: buyer/tenant profiles, occupancy, and absorption
14. Existing inventory, properties under construction, and planned properties
components which do not comprise supply
15. Amortization is the systematic reduction of debt over time
16. An organized exchange conduit is characteristic of an efficient market
17. A Seller’s market is a market where there are many potential buyers but few properties are available.
18. A Buyer’s market is a market where there are many properties available and few potential buyers
19. Market analysis is the study of current supply and demand conditions in a particular area for a
specific type of property.
20. The relationship of the final real estate value estimate to market perceptions should be considered
21. Current listings that have been exposed to the open market for a reasonable time
what the subject market value cannot exceed
22. Market value is based on most probable use
23. Market price is what the property will sell for, while market value is what the sale price should be to a
typical buyer
24. Market value is the amount express in terms of money as of a certain date that may reasonably be
expected to exchange between a willing seller and a willing buyer with equity to both neither under any
compulsion to buy or sell and both are aware of all relevant facts.
25. Market value can be described as present worth of future benefits
26. The Multiplier Effect refers to the effect that is made by one aspect of the economy with the other
economic activities in the country.

27. It is said that real estate economics is the application of economic techniques to real estate markets
where it tries to describe, explain, and predict patterns of demand, price, and supply
include needs
28. Price is a result of the interplay and relationship between supply and demand in a particular market
like real estate
29. The formula used to compute the monthly amortization on a diminishing balance method for
installment sales of lots is amount financed multiplied by amortization factor
30. Under the present Pagibig Financing, the minimum amount of interest charged for housing loan is
31. In a subdivision, there were numerous lots being sold by owners but only a few buyers were buying.
This is referred to as a Buyer’s Market
32. A buyer will loan from the bank for the purchase of a house. The amount of difference between what
the total price will be and the amount he can borrow is referred to as
33. In computing the amortization factor on the financing of real estate sales, the factor will be based
interest rate and term of payment
34. A residential subdivision was much in demand but there were only a few lots sold but a lot of buyers
were interested to buy. This is referred to as Seller’s Market
35. Spot cash is not considered a sale on financing or installments in the purchase of a lot
36. Mr. and Mrs. Parte wanted to loan under the Pagibig Financing to buy a residential lot, and they can
purchase a maximum size of 1,000 sq.m.
37. In obtaining a housing loan from the bank, it is required that the house purchased must be
mortgaged to the bank
38. The payment to be made monthly by a buyer of a lot on installment is generally referred to as
monthly amortizations