A 15-year-old improvement has supported effective age 10 years after condition-and-utility analysis. What does that comparison indicate?
Correct Answer
B) Less effective aging than its chronological age suggests.
A lower supported effective age indicates less economic aging in the assessed condition and utility than typical chronological aging. It can reflect maintenance and modernization; it does not by itself prove price appreciation or an error in construction records.
Why This Is the Correct Answer
Option B is correct because a supported effective age of 10 years on a 15-year-old improvement indicates less effective aging than its chronological age suggests. The relationship between actual and effective age is a good indication of condition, often reflecting good maintenance or updating.
Why the Other Options Are Wrong
Option A: Proof that the construction date is wrong.
Option A says the comparison is proof that the construction date is wrong. A difference between effective and actual age is expected when condition differs from typical, so it does not suggest a records error.
Option C: Proof that its market value appreciated.
Option C says the comparison is proof that market value appreciated. Effective age describes condition and utility, and it does not by itself show any change in price over time.
Option D: Proof that it suffers the worst functional obsolescence.
Option D says the comparison proves the worst functional obsolescence. A lower effective age points to better-than-typical condition and utility, the opposite of severe obsolescence.
Lower effective age, younger feel
If effective age is lower than actual age, the building acts younger than it is. If higher, it acts older.
How to use: Use younger feel or older feel to interpret any gap between effective and actual age.
Exam Tip
Effective age is an observation about condition and utility. Be cautious with answer choices that turn it into proof about dates, prices or obsolescence.
Common Mistakes to Avoid
- -Reading a lower effective age as a records error
- -Treating effective age as evidence of appreciation
- -Confusing a lower effective age with greater obsolescence
Concept Deep Dive
Analysis
This question tests what it means when effective age is lower than actual age. A lower effective age signals that the property's condition and utility reflect less aging than its years would suggest. It does not prove anything about records, appreciation or obsolescence.
Background Knowledge
Effective age is the age indicated by condition and utility, while actual age counts years since construction. When effective age is lower than actual age, the property has been maintained or updated better than typical. When it is higher, the property shows more wear or less utility than its years suggest.
Real-World Application
An appraiser inspects a 15-year-old house whose owners replaced the roof, windows and kitchen. She assigns an effective age of 10 years and notes in her report that the home's condition is better than typical for its age.
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