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Exam 17: Investing in Real Estate and Other Investment Alternatives

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Question 41

Multiple Choice

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Easing of international tensions or disinflation cause gold prices to:

A) skyrocket.
B) increase moderately.
C) remain stable.
D) decline.
E) change, but the direction of the change cannot be predicted.

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Question 42

Multiple Choice

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If you want a risk-proof real estate investment, invest in:

A) real estate investment trusts.
B) real estate limited partnerships.
C) participation certificates (PCs) .
D) real estate syndicates.
E) post office buildings.

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Question 43

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A REIT must invest all of its assets in real estate.

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

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

Housing will continue to be a not-so-liquid investment that promises steady returns over time.

Easing of international tensions or disinflation causes a decline in gold prices.

Most gold brokers require a minimum order of how many bullion coins?

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

If a gold bullion bar does not remain in the possession of the dealer or bank that sells it, what must happen before it can be resold?

Real estate investment trusts are government-owned real estate companies.

During which of the following economic periods is the price of a precious metal, such as gold, silver or platinum, likely to increase?

Which of the following is a requirement of a REIT?

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

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

Which of the following is not a characteristic used to grade certified diamonds?

Which of the following is a possible disadvantage of real estate investments?

Investment in land usually produces considerable cash flow.

Brian Wilson has several baseball cards passed down to him from his grandfather. He is particularly proud of the signed Hank Aaron baseball card that he has. What type of investment does he hold?

Austin has invested $25,000 as one of 10 limited partners in a large shopping center that was purchased for $800,000. The shopping center has been unsuccessful and the four general partners fear that the property could be foreclosed upon soon. What is the most Austin might lose if the project fails?