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Exam 17: Investing in Real Estate and Other Investment Alternatives

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Question 21

True/False

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Financial leverage enables you to acquire a more expensive property than you could on your own.

A) True
B) False

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Question 22

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De Beers Consolidated Mines of South Africa controls what percent of the world's supply of rough diamonds?

A) 50
B) 65
C) 75
D) 85
E) 95

F) A) and E)
G) B) and E)

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Question 23

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An example of an indirect real estate investment is a:

Many developers,lenders,and investors were victims of deflation in commercial real estate beginning in the:

In a direct real estate investment,the investor holds legal title to the property.

Jeremy Fischer has just purchased 20 American eagle gold coins from a broker.What type of investment does he hold?

You can avoid storage and assaying problems by investing in gold bullion coins.

Many investors buy land with the intention of subdividing it.

Commercial property refers to land and buildings that produce lease or rental income.

The tax shelter aspect of real estate syndicates no longer exists due to the Tax Reform Act of 1986.

An example of an indirect real estate investment is:

Financial leverage is a disadvantage when property values and incomes are rising.

In general,the price of gold:

Increasing interest rates in the economy cause gold prices to:

Jefferson Davis has invested in something that acts like a mutual fund and that invests in hospitals all over the country.He knows there are federal laws that require this type of investment to distribute at least 90 percent of the income to shareholders and that requires there be at least 100 shareholders.What type of investment has Jefferson made?

REITs,Ginnie Maes,Freddie Macs,and other syndicates do not provide any diversification.

The first gold bullion coin ever produced by the U.S.government was issued in 2001.

There are three types of REITs: equity REITs,mortgage REITs,and hybrid REITs.

A REIT is a firm that pools investor funds and invests them in real estate or uses them to make what kind of loans?

A REIT is similar to a mutual fund or an investment company,and it trades on stock exchanges or over-the-counter.