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Humber College Exam 4: Invigilated Theory Sample Questions:

1. When discussing the sale of a business and establishing the asking price, there are questions a salesperson must ask the owner. Which of the following is one of them?

A) Is inventory included in the sale of this business?
B) What is the construction cost of the building?
C) Is there any easement on the property?
D) Is the ownership of the building a corporation or a partnership?

2. A salesperson is drafting an offer and discussing with the buyer the steps required for due diligencewhen purchasing a commercial condominium unit. All of the steps below are included in due diligence, EXCEPT:

A) Create a business plan
B) Estimate time frames required for due diligence and other offer conditions
C) Gather, organize, and verify all pertinent information
D) Identify third-party professionals

3. Different clauses can be used for each transaction to address the unique needs of buyers and sellers. Which of the following may be used in an agreement of purchase and sale to buy a commercial property?

A) A clause for the seller to disclose all information verbally without providing supporting documents to verify that information; documents to be provided on closing
B) A clause for the buyer to review the leases only after all conditions have been waived and accepted
C) A clause to confirm the remuneration payable to the brokerages will be as stated in the seller representation agreement
D) A clause for the buyer to have the right to negotiate for specialized restaurant equipment that is not included in the property purchase price

4. A salesperson is representing a tenant client who is opening a new pet food store in a local strip plaza. The salesperson meets with their tenant to discuss display signage and review the guidelines in their commercial lease agreement. Which statement is NOT accurate regarding the commercial lease agreement's signage clause?

A) The tenant's signage shall be immediately removed at the end of their lease term(s) at the tenant's expense.
B) The tenant's signage must be approved by the municipality and the landlord, and all associated costs shall be paid by the landlord.
C) The tenant's signage, from approvals to installation and ongoing maintenance, shall be at thetenant's own expense.
D) The tenant's signage is considered a trade fixture and shall remain the tenant's property.

5. Both the landlord and the tenant have responsibilities in the management of their relationship as per the commercial lease agreement. Which of the following is NOT an accurate statement regarding the roles and responsibilities of landlords and tenants as per the Commercial Agreement to Lease?

A) All commercial leases require that tenants keep everything in and about the property, including all points of entry and exit, in good repair at all times.
B) Not all commercial leases require the landlord to perform repairs and maintenance.
C) The landlord must address their tenants' issues in a timely manner in general but more so when the issue can result in serious and costly consequences.
D) Tenants are obligated to ensure they have adequate tenant insurance for their property.

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