L&B Mock Test I

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L&B Mock Test I

All India Valuers Association L&B Mock Test

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1. Difference between selling price and variable cost per unit can be classified as per unit.

1 point

a. contribution margin

b. interest margin

c. rent margin

d. profit margin

Clear selection

2. In double entry system, accounts are primarily classified in to .

1 point

a. Receiver account & Giver account

b. Income account & Expenses account

c. Real account & Nominal account

d. Personal Account & Impersonal account

Clear selection

3. In an adjustment grid model exercise assignment of weightages to factors is best done on the basis of:

1 point

a. Relative importance of factors to the local people

b. Relative importance to the valuer

c. Valuer’s intuition and knowledge

d. Valuer’s judgement of value

Clear selection

4. A real estate JV agreement does not include which of the following factors:

1 point

a. Distribution of profits

b. Capital contribution

c. Management and control

d. Insurance

Clear selection

5. What is the date of assessing value for the assets under the Land Acquisition Act, 2013?

1 point

a. Date of proposal

b. Date of public hearing

c. Date of impact assessment

d. Date of notification

Clear selection

6. A market which has only one seller selling a homogeneous product to many buyers is known as:

1 point

a. oligopoly

b. monopoly

c. perfect competition

d. monopolistic competition

Clear selection

7. For a real estate construction company, which of the following is not part of Profit and Loss statement?

1 point

a. Revenue from apartment sales

b. Interest paid to lenders

c. Cash deposited in bank

d. Depreciation expense

Clear selection

8. Discount received is recorded on which side of a cash book?

1 point

a. Receipts

b. Payments

c. Income

d. Expense

Clear selection

9. Theories of factor of production consider __________ to be the reward for the entrepreneur.

1 point

a. rent

b. interest

c. profit

d. capital

Clear selection

10. Which of the following is true with reference to Easement

1 point

a. It is a possessionary right

b. It is a non possessionary right

c. It is related to movable and immovable properties

d. It is a licence not a right

Clear selection

11. Which of the following valuation approach generally considered, which gives true investment made by the person with reference to immovable properties?

1 point

a. Income

b. Cost

c. Market

d. Development

Clear selection

12. Size, shape, plot area, frontage and depth, vista, orientation, soil type, topography etc. are characteristics of land, are __________ factors that affect the value of a subject land.

1 point

a. legal

b. cultural

c. physical

d. economic

Clear selection

13. Which of the following is not a characteristic of the informal economy?

1 point

a. Easy entry

b. No taxes

c. Predominantly micro

d. Regulated businesses

Clear selection

14. Which method of valuation is best used to estimate fair market value of land of large size on the basis of sale of smaller plots?

1 point

a. Adjustment grid method

b. Hypothetical plotting method

c. Hedonic sales

d. Belting method

Clear selection

15. In valuation of immovable properties, bad workmanship in construction of building affects which of the following life of building?

1 point

a. Economic life

b. Life to due to obsolescence

c. Physical life

d. Life due to legal constraints

Clear selection

16. Which of the following is not a means of transfer, under the Transfer of Property Act,1882?

1 point

a. Sale of Plot

b. Gift of land

c. Mortgage of plot

d. Hypothecation of Land

Clear selection

17. If a person has an income of Rs.30,000 and his consumption is Rs.10,000, then his propensity to save is:

1 point

a. 1.33

b. 0.33

c. 0.67

d. 1.50

Clear selection

18. Investment does not depend significantly upon the .

1 point

a. demand

b. level of income

c. progress of technology

d. expectation of the entrepreneur

Clear selection

19. In its simplest form, the residual method yields the maximum purchase of a site as __________

1 point

a. Expected price of the developed property –(expected development costs + allowance to cover risk and profit)

b. Expected income from property – development cost

c. Expected cost of development + profits

d. expected development costs + allowance to cover risk and profit

Clear selection

20. In valuation of buildings, depreciation is reduction in __________ with passage of time.

1 point

a. Price

b. Value

c. Worth

d. Cost

Clear selection

Attempt given questions based upon the following case studies.An owner purchased a piece of land measuring about 350 m² and constructed a bungalow of ground and one upper floor for his personal use some 30 years back. The bungalow is of first-class construction having a future economic life of 40 years and has got the total built-up area of 300 m². The owner now desires to sale the same and has received an offer of Rs.55 lakhs with vacant possession or in the alternative he has been offered a gross yearly rent of Rs.2,00,000 for the bungalow and the plot together. There is good demand for such property in the locality. Other information is as follows:• Value of land in the locality for similar plots = Rs.8000 per sq.m.• Present replacement cost of such a bungalow = Rs.15,000 per sq.m.• Total outgoings = 15 per cent of the gross rent• Annual sinking fund for redemption of Re. 1 at 5 per cent in 70 years = 0.0017• Amount of Re. 1 per annum in 30 years at 5 per cent= Rs.66.439• Year’s purchase at 3% in perpetuity = 33.33

21. What is the amount of depreciation of the bungalow?

1 point

a. 42.86 %

b. 11.29 %

c. 15.30 %

d. Zero

Clear selection

22. What will be the depreciated replacement cost of the bungalow?

1 point

a. Rs.39,91,950

b. Rs.38,11,500

c. Rs.35,12,250

d. Rs.45,00,000

Clear selection

23. What will be the insurable value for reinternment policy?

1 point

a. Rs.39,91,950

b. Rs.45,00,000

c. Rs.65,00,000

d. Rs.38,11,500

Clear selection

24. What will be the market value of the property by income approach?

1 point

a. Rs.66,66,000

b. Rs.56,66,000

c. Rs.55,00,000

d. Rs.50,00,000

Clear selection

25. What will be the depreciation amount of the bungalow by adopting straight line method of depreciation and considering scrap value at 10 %?

1 point

a. Rs.60,00,000

b. Rs.54,00,000

c. Rs.45,00,000

d. Rs.12,00,000

Clear selection

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