Q12. In efficient financial markets, unregulated competitive bidding should bring about the most productive use of an asset and the price paid for that asset should reflect fair value based on its usefulness. In real estate, this is not always the case. For example, there is no substitute for certain pieces of land which gives the owner a bargaining advantage in determining the value of the land. This feature of real estate markets is commonly
Q12. In efficient financial markets, unregulated competitive bidding should bring about the most productive use of an asset and the price paid for that asset should reflect fair value based on its usefulness. In real estate, this is not always the case. For example, there is no substitute for certain pieces of land which gives the owner a bargaining advantage in determining the value of the land. This feature of real estate markets is commonly
Chapter32: The Land Market And Natural Resources
Section: Chapter Questions
Problem 10E
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Transcribed Image Text:Q12. In efficient financial markets, unregulated competitive
bidding should bring about the most productive use of an asset
and the price paid for that asset should reflect fair value based
on its usefulness. In real estate, this is not always the case. For
example, there is no substitute for certain pieces of land which
gives the owner a bargaining advantage in determining the value
of the land. This feature of real estate markets is commonly
referred to as:
a. Incomplete information b. location monopoly C.
positive externality d. negative externality
Q13. In order for the board of adjustment to approve a variance,
all of the following conditions must be met EXCEPT:
a. The owners must be unable to use the lot as zoned
b. The condition is common to other parcels of land as
zoned
c. The variance must not materially change the character of
the community
d. The condition is unique to the lot
Q14. Zoning is an exercise of which type of general limitation
on property rights
c. Police power
a. Eminent domain b. taxation
d. Escheat e. all of the above
Q15. One of the main criticisms of property taxes is that the
property tax of lower income households is higher than that of
higher income households, as a percentage of their respective
incomes. In other words, taxes are criticized for being:
a. Regressive
b. Comprehensive c. Concurrent
d. Extraterritorial
Q16. Given the following information, compute the property tax
rate for the community in percentage terms. Total budget
expenditures: $108 million, Total non-property tax income: $50
million, Total assessed value of all properties: $2 billion, Total
exemptions: $550 million.
a. 2.5%
b. 4%
d. 12%
c. 10%
Transcribed Image Text:Q9. Traditional zoning regulations are criticized for often being
too rigid in forcing uniform types of development. One proposed
solution to this issue allows traditional zoning requirements to
vary in exchange for an enhancement to the community, such as
the construction of a park. This is more commonly referred to as
a:
a. Planned unit development
standard
Restriction
c. Impact Fees
b. Performance
d. Growth
Q10. When land use controls impose exceptional hardship and
loss of value, a relief mechanism must be provided. This relief is
referred to as a:
a. Building code b. zoning ordinance C.
comprehensive plan d. Variance
Tax-exempt
Q 11. Real estate taxes represent the largest single source of
revenue for a large portion of local governments. Most property
taxes are applied in relation to the value of the property, or in
other words, they are:
a. Effective tax rates b. Ad valorem tax rates
d. Regressive
C.
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A market is a gathering place for consumers and sellers where they can exchange goods and services. In the study of economics, a marketplace is a collection of mechanisms that allow for the exchange of goods and services between parties. Markets can be real-world like a store or virtual like an online merchant.
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