Real Estate License Practice Test (Brokerage Responsibility & Agency Management)

Question 1

What is the legal status of listing brokers' and sellers' agency relationships?

Accepted Answer

Specific agency.

Answer

The agency relationship between a listing broker and a seller is classified as a specific agency. This means the broker is authorized to perform a specific act or transaction, which in this case is selling the seller's property. The broker's authority is limited to this particular task, rather than having broad authority over all the seller's affairs.

Question 2

Irene is the owner of a warehouse and has decided to sell it on the open market. Brokers X, Y, and Z have been contacted to sell it on her behalf. Who gets the commission if Broker Y closes the deal?

Accepted Answer

broker Y

Answer

In an open listing agreement, the owner retains the right to sell the property themselves or list it with multiple brokers. A commission is only paid to the broker who successfully finds a ready, willing, and able buyer and closes the deal. Therefore, if Broker Y closes the deal, Broker Y is the one who earns the commission.

Question 3

Susan David is putting her two-bedroom, one-bathroom condo on the market. With a local real estate licensee, she signed exclusive right-to-sell listing agreement. Which of the following statements accurately describes the agency relationship that this sort of listing agreement creates?

Accepted Answer

Express agency.

Answer

An exclusive right-to-sell listing agreement creates an express agency relationship. This means the agency relationship is formed through a clear, written contract between the principal (seller) and the agent (broker), explicitly outlining the terms, duties, and duration of the agreement. It is not implied but rather formally stated and agreed upon by both parties.

Question 4

When there is a delegation of authority to perform a single act, a ________ agency is formed.

Accepted Answer

special agent

Answer

When there is a delegation of authority to perform a single, specific act, a special agency is formed. In real estate, a listing broker acting for a seller is typically a special agent, authorized only to market and sell a particular property. This contrasts with a general agent, who has broader authority over a range of matters for the principal.

Question 5

In an open listing, who takes the biggest risk?

Accepted Answer

the agent

Answer

In an open listing, the agent takes the biggest risk because they are only paid if they are the procuring cause of the sale. If another agent or even the owner sells the property, the agent who invested time and resources in marketing the property receives no commission. This contrasts with exclusive listings, where the agent is more assured of compensation.

Uncategorized Practice Test

Uncategorized Practice Test

Real Estate License Practice Test (Brokerage Responsibility & Agency Management)