ECO
Property Valuation Quiz
Test your knowledge on key concepts of property valuation and economic principles with our engaging quiz! This quiz contains 26 questions covering various aspects such as depreciation, salvage value, and methods of valuing properties.
Whether you are a student, a professional, or just curious about real estate, this quiz is perfect for you. Challenge yourself and see how well you understand economic evaluations of properties.
- 26 Multiple Choice Questions
- Assess your understanding of property economics
- Perfect for students and professionals
The decrease in the value of physical property with passage of time
Depreciation
Market Value of a property
Value
Utility
In commercial sense, is the present worth of all future amounts that are to be received through ownership of a particular property
Value
Depreciation Cost
Depreciation
Utility
Is the amount which a willing buyer will pay to a willing seller for the property where each has equal advantage and is under no compulsion to buy or sell.
Market value of a property
Depreciation
Salvage Value
Scrap
Is what the property is worth to the owner as an operating unit
Utility
Scrap
Depreciation
Fair value
Is the value which is usually determined by a disinterested third party in order to established a price that is fair to both the seller and the buyer.
Fair Value
Depreciation cost
Physical Life of a property
Salvage
Is the original or historical cost of a property less the accumulated depreciation.
Book Value
Scrap
Economic Life
Salvage
Is the price that can be obtained from the sale of property as second hand. This implies that the property is still usable.
Salvage Value
Scrap
Fair value
Utility
Is the amount that a property can be sold off as junk
Scrap
Utility
Fair value
Depreciation
Is the length of time for which the property is capable of performing the function for which it was designed or manufactured.
Physical Life of a property
Economic life
Market value of a property
Scrap
Is the length of time during which the property maybe operated at a profit.
Economic Life
Salvage value
Scrap
1st cost of equipment
Includes original purchase price plus delivery cost, installation cost and corresponding fees and taxes.
First Cost of Equipment
Depreciation cost
Salvage
Scrap
Is the difference between the first cost and salvage value or scrap value of a property.
Depreciation Cost
Scrap
Depreciation
Value
Assumes that value of property is proportional to its age.
Straight Line Method
Sinking Fund Formula
Declining Balance Method
Sum-of-the-Years-Digits (SYD) Method
The value of a property decreases at a descending rate
Sum-of-the-Years-Digits (SYD) Method
Double Declining Balance Method
Declining Balance Method
Sinking Fund Formula
Concept is similar to annuity where equal amount of payment (or fund) is set aside so that its accumulated total will be equal to replacing the property once its useful life has been used up.
Sinking Fund Formula
Straight Line Method
Declining Balance Method
Double Declining Balance Method
Asset decreases in value faster in early period than the latter portion of its economic life. Annual depreciation is assumed fixed percentage of the book value at the beginning of a year. This method is not applicable if salvage value of a property is zero. Also known as Constant Percentage Method or Matheson formula.
Declining Balance Method
Sinking Fund Formula
Straight Line Method
Sum-of-the-Years-Digits (SYD) Method
Very similar to Declining Balance Method except that the rate of depreciation k is replaced by 2/L.
Double Declining Balance Method
Straight Line Method
Sum-of-the-Years-Digits (SYD) Method
Sinking Fund Formula
Is a measure of the effectiveness of an investment of capital.
Rate of Return (ROR) Method
Annual Worth Method
Present Worth Method
Future Worth Method
In this method, minimum required profit on the invested capital is included as a cost. If the difference in revenue and disbursement is not less than zero, proposed investment is justified or viable.
Annual Worth Method
Rate of Return (ROR) Method
Present Worth Method
Future Worth Method
If the present worth of the net cash flow is equal to or greater than zero, project is economically justified.
Present Worth Method
Annual Worth Method
Future Worth Method
Rate of Return (ROR) Method
If the future worth of the net cash flow is equal . To or greater than zero, project is economically justified
Future Worth Method
Present Worth Method
Annual Worth Method
Rate of Return (ROR) Method
Analysis and evaluation of the factors that will affect the economic success of engineering projects to the end that a recommendation can be made which will ensure the best use of capital
Engineering Economy
Interest
Ordinary Simple Interest
Exact Simple Interest
The amount of money paid for the use of borrowed capital, The income earned by money which has been loaned
Engineering Economy
Interest
Ordinary Simple Interest
Exact Simple Interest
Calculated using the principal only, ignoring any interest that had been accrued in preceding interest periods
Simple Interest
Scrap
Ordinary Simple Interest
Engineering Economy
Specifies the rate of interest and the number of interest period/s in one year
Nominal Rate of Interest
Effective Rate of Interest
Simple Interest
Actual rate of interest on the principal for one year
Effective Rate of Interest
Nominal Rate of Interest
Simple Interest
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