CFA Blue Book & Auction Comparable Analysis 2 — Questions and Answers
Question 1: When using the Blue Book of Gun Values, which grading category describes a firearm that retains 80% of its original finish with only minor handling marks?
- Very Good (VG) (Correct answer)
- Good (G)
- Excellent (EX)
- Fair (F)
Correct answer: Very Good (VG)
Very Good (VG) in the Blue Book system denotes 80% or more original finish remaining with minor use marks but no major defects.
Question 2: An appraiser finds a Rock Island Auction result for a Colt Python but the example sold was a different barrel length than the subject firearm. What is the correct adjustment approach?
- Apply a percentage premium or discount based on known market demand for each barrel length (Correct answer)
- Discard the comparable entirely since barrel lengths differ
- Use the auction price as-is since Python models are interchangeable
- Average all Python auction results regardless of configuration
Correct answer: Apply a percentage premium or discount based on known market demand for each barrel length
Appraisers must adjust comparable sales for configuration differences such as barrel length, applying market-supported percentage adjustments to arrive at an accurate value.
Question 3: Which of the following auction houses is most recognized in the firearms industry as a primary source for high-value antique and collectible gun auction comparables?
- Rock Island Auction Company (Correct answer)
- Sotheby's
- Christie's
- eBay Motors
Correct answer: Rock Island Auction Company
Rock Island Auction Company is the world's premier firearms auction house and is the most widely cited source for collectible and antique firearm comparable sales.
Question 4: A Blue Book value for a firearm lists a '100% NIB' price. What does NIB specifically mean in this context?
- New In Box (Correct answer)
- Never Issued Bore
- Near Identical Build
- Nationally Inspected Bore
Correct answer: New In Box
NIB stands for New In Box, indicating an unfired firearm with all original packaging, papers, and accessories present.
Question 5: When reconciling multiple auction comparables that show a wide price range for the same model, an appraiser should:
- Analyze each result for condition, configuration, and provenance differences before weighting the most relevant (Correct answer)
- Always use the median price without further analysis
- Select only the highest result to protect the owner's interests
- Average all results equally regardless of condition differences
Correct answer: Analyze each result for condition, configuration, and provenance differences before weighting the most relevant
Proper comparable analysis requires understanding why prices differ before weighting those most similar in condition and configuration to the subject.
Question 6: The Blue Book of Gun Values is updated how frequently to reflect current market conditions?
- Annually (Correct answer)
- Monthly
- Every five years
- Quarterly
Correct answer: Annually
The Blue Book of Gun Values publishes a new edition annually, reflecting changes in market demand, production status, and collector trends.
Question 7: In auction comparable analysis, the term 'buyer's premium' refers to:
- An additional percentage fee charged to the buyer on top of the hammer price (Correct answer)
- A discount given to repeat auction buyers
- The reserve price set by the seller
- The commission paid by the consignor
Correct answer: An additional percentage fee charged to the buyer on top of the hammer price
The buyer's premium is an additional fee, typically 10–25%, added to the hammer price that the buyer pays, affecting the true acquisition cost.
CFA Blue Book & Auction Comparable Analysis 2
When using the Blue Book of Gun Values, which grading category describes a firearm that retains 80% of its original finish with only minor handling marks?