1. Collectible items are considered to be real assets. (Points : 1) True False 2
ID: 1891686 • Letter: 1
Question
1. Collectible items are considered to be real assets. (Points : 1)True
False
2. Movements between various real and monetary assets are less positively correlated than those for monetary assets alone. (Points : 1)
True
False
3. A shared appreciation mortgage usually has an interest rate below current market rates. (Points : 1)
True
False
4. While providing an effective hedge against inflation, real assets do not have particularly efficient liquid markets. (Points : 1)
True
False
5. The negative impact of tax reform on real estate was partly associated with declining economic conditions in various sections of the country during the late 1980s and early 1990s. (Points : 1)
True
False
6. Graduated payment mortgages may require payment of interest on accumulated, unpaid interest. (Points : 1)
True
False
7. Limited liability is particularly important in real estate because mortgage debt obligations may exceed the net worth of participants. (Points : 1)
True
False
8. Real assets may offer an opportunity as an inflation hedge, because inflation means higher replacement costs for real estate, precious metals, and other physical items. (Points : 1)
True
False
9. Gold ownership is considered a hedge against inflation. (Points : 1)
True
False
10. Under a graduated payment mortgage, annual payments are adjusted based on the new existing interest rate. (Points : 1)
True
False
11. Which of the following is NOT a characteristic of real estate investment trusts? (Points : 1)
Similar to mutual funds, they pool investor funds and invest directly in real estate or make construction or mortgage loans
They provide a tax shelter to wealthy investors
It is the most liquid type of real estate investment
All of the above are characteristics of REITs
12. Real assets may be effective for portfolio diversification because (Points : 1)
They provide an effective hedge against deflation
They are perceived as a safe haven for investments
Real and financial assets are less positively correlated than financial assets alone
None of the above
13. Real estate is a particularly good investment among real assets because of (Points : 1)
Depreciation write-offs
Appreciation in value due to price appreciation
Long-term financing
All of the above
14. Depreciation (Points : 1)
On residential real estate property can be written off over 31 1/2 years
On commercial real estate can be written off over 31 1/2 years
Can be accelerated for commercial real estate
None of the above
15. Real assets often increase in value when (Points : 1)
Higher levels of inflation are anticipated
The stock market is advancing
The public is confident about world events
Bond prices are advancing
16. The best time to buy collectibles is when (Points : 1)
The bloom is off the market and dealers are overburdened with inventory.
There is a weekly story in the Wall Street Journal or Business Week about fortunes being made in the collectible market
The economic outlook is moving from inflation to deflation
The economy is at a peak headed for a downturn
17. Which of the following statements is NOT true? (Points : 1)
Like gold, silver is a good hedge against inflation
Silver has extensive industrial and commercial uses
The supply of silver immediately increases with the price of silver
All of the above are true
18. In recent times suppliers of second mortgages have often been (Points : 1)
Buyers of real estate
Real Estate Investment Trusts (REITs)
Sellers of real estate
Real estate brokers
19. The gold coin that trades at the smallest premium over its pure bullion value is (Points : 1)
Gold bullion coins
Common date gold coins
Old and rare coins
The American double eagle
20. The Shared Appreciation Mortgage (Points : 1)
Has the interest adjusted regularly
Has the payments start out on a relatively low basis and increase over the life of the loan
Has the term of the loan adjusted regularly
None of the above
21. Equity participation (Points : 1)
Is popular in commercial real estate
Lets the lender provide borrowed capital
Lets the lender provide part of the equity or ownership funds
All of the above
22. Real estate investment trusts are similar to mutual funds or investment companies because: (Points : 1)
They do not trade on organized exchanges, but do trade over-the-counter
They pool investors' funds
They are both limited partnerships
All of the above
23. The best time to buy collectibles such as art, antiques, musical instruments, etc. is when (Points : 1)
The stock market is down
No one else seems very interested
A period of high inflation begins to level off
None of the above
24. Historically the best time to buy gold and silver is (Points : 1)
When the stock market is declining
When there is significant political instability or anticipation of war
During periods of high inflation
All of the above
25. Real assets are (Points : 1)
Tangible assets that may be seen, felt, held, or collected
Paper assets that are usually traded over an exchange
Also known as financial assets
Are not diversifiable
26. In evaluating a general partner of a limited partnership an investor should be sensitive to his or her (Points : 1)
Experience
Possible lawsuits
Law degree
A and B
27. Which is not an approach to real estate valuation? (Points : 1)
Cost approach
Comparative sales value
Price-earning ratio
Income approach
28. The most significant advantage(s) of limited partnerships are (Points : 1)
Limited liability of limited partners and direct assignment of profits and losses to the partners
Unlimited liability of general partners
Favorable tax treatment of capital gains and management participation features
None of the above
29. Which of the following is not a real asset? (Points : 1)
Mickey Mantle baseball card
100 shares of a REIT
Gold bullion
An apartment complex
30. Which of the following allow the individual to invest in gold without actually owning gold? (Points : 1)
Gold stock
Gold futures
Options on gold futures
All of the above
Explanation / Answer
true
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