PREX-1060A by Humber College Valid Free Exam Practice Test

Question 1

When discussing the sale of a business and establishing the asking price, there are questions a salesperson must ask the owner. Which of the following is one of them?

A. Is there any easement on the property? B. Is the ownership of the building a corporation or a partnership? C. What is the construction cost of the building? D. Is inventory included in the sale of this business?

Correct Answer: D

Question 2

A first-time investor is looking to purchase a commercial property and asks their salesperson about the gains they can hope to achieve from this type of asset. What should the salesperson explain to their client regarding the purchase of commercial properties as a source of capital growth?

A. The salesperson should explain that the client should always consider being a short-term investor. B. The salesperson should explain that a better return on investment will be achieved with rising interest rates. C. The salesperson should explain that making a commercial property investment is an easy and smooth process that provides good short-term gains. D. The salesperson should explain that to achieve capital growth, the client should be a long-term investor.

Correct Answer: D

Question 3

A landlord and a tenant have signed an agreement to lease an office space. Prior to the transaction closing, an unforeseeable event occurs that is not the fault of either party. Which statement about the return of the tenant's deposit is NOT correct?

A. The tenant can have the deposit back without signing a mutual release as it is not their fault. B. The landlord and tenant may agree to split the deposit. C. The parties may need to obtain a court order that clarifies how the deposit will be returned and distributed. D. The agreement may contain a clause forfeiting all of the deposit if the landlord has started work on the premises.

Correct Answer: A

Question 4

Which of the following practices maintains the stability and durability of a commercial property?

A. Increasing the base rent and additional rent in a slow economy B. Keeping good tenants C. Replacing old tenants with new tenants that pay much higher rent D. Delaying improvements to the property to save costs

Correct Answer: B

Question 5

A salesperson should know how to gather key information about a new commercial condominium, including the size of a unit. Which of the following sources of information should a salesperson rely on?

A. An opinion from the property manager B. A surveyor's certificate for the unit C. A sketch of the seller's floor layout D. An opinion from the seller's lawyer

Correct Answer: B

Question 6

A salesperson is representing a commercial tenant client who is interested in leasing a property for their business. The salesperson and their client are inspecting a property that includes a few accessory buildings.
This is ideal for the tenant, as the accessory buildings can serve as storage for their business. The tenant asks their salesperson to find out the measurements of the accessory buildings. Why is it important for the tenant to know the total area of the accessory buildings included on the property?

A. It is important for the tenant to know the total area of the accessory buildings as they will have to share the use of them with other tenants. B. It is important for the tenant to know the total area of the accessory buildings as it will be considered within the tenant's usable area. C. It is important for the tenant to know the total area of the accessory buildings as it will contribute to their rentable area. D. It is important for the tenant to know the total area of the accessory buildings as it will be deducted from their rentable area.

Correct Answer: C

Question 7

A new commercial condominium project is completed, and the buyers are given an occupancy date. On the occupancy date, a few of the buyers move into their units and begin setting up their operations. That evening, there is a severe thunderstorm. In the morning, several of the buyers start to notice roof leaks. Some of the buyers call the builder's office while others call their salespersons.Which of the following is an accurate statement regarding the building's warranty coverage?

A. There is no provincial warranty coverage for commercial condominiums, but the buyers can inquire with the builder about any warranties that they may offer. B. The buyers should draft a list of all their concerns and submit them to the municipality for appropriate coverage. C. The buyers should submit their concerns to the provincial warranty authority, as they are entitled to one- year warranty coverage from the occupancy date. D. If the builder does not address this issue, the buyers can file a complaint with the provincial warranty authority for any outstanding work the builder did not complete.

Correct Answer: A

Question 8

Which of the following statements about industrial building components is correct?

A. Loading docks are only used to off-load products or raw materials. B. Bay depth is an important consideration when determining the layout of an industrial process. C. Flat roofs are designed to be flat to hold water. D. Floor load refers to the weight of the building during construction.

Correct Answer: B

Humber College Exam 4: Invigilated Theory - PREX-1060A Exam Practice Test