External obsolescence is described as incurable primarily because:
Correct Answer
D) It is caused by forces the owner cannot control
Why this is correct: External obsolescence is incurable because, as the original explanation states, it is caused by forces outside the property and beyond the owner's control, such as a new highway or a closed factory. The owner cannot feasibly eliminate the cause. Why the other choices are wrong: 'Its repair always exceeds the property's total value' describes economic incurability for some items, but is not the defining reason for external obsolescence. 'It affects only properties older than fifty years' is false; external obsolescence can affect properties of any age. 'Building codes prohibit correcting external conditions' is incorrect; codes do not typically address external economic forces. Exam tip: Remember: 'incurable' for external obsolescence means the cause is off-site and uncontrollable, not that the cost to cure is too high.
Why This Is the Correct Answer
Why this is correct: External obsolescence is incurable because, as the original explanation states, it is caused by forces outside the property and beyond the owner's control, such as a new highway or a closed factory. The owner cannot feasibly eliminate the cause. Why the other choices are wrong: 'Its repair always exceeds the property's total value' describes economic incurability for some items, but is not the defining reason for external obsolescence. 'It affects only properties older than fifty years' is false; external obsolescence can affect properties of any age. 'Building codes prohibit correcting external conditions' is incorrect; codes do not typically address external economic forces. Exam tip: Remember: 'incurable' for external obsolescence means the cause is off-site and uncontrollable, not that the cost to cure is too high.
More Cost Approach Questions
In a cost approach for a proposed building, the appropriate cost basis is generally:
A warehouse cost $210,000 to build when the cost index stood at 105. The index is now 210. Its indicated current cost is:
The age-life method expresses depreciation as:
Market extraction of depreciation is limited by the fact that it:
Functional obsolescence caused by a deficiency is measured as curable when:
Curable physical deterioration is measured at cost to cure because:
A 2,050 sq ft dwelling is priced at $178 per square foot with a $34,000 detached garage and $21,500 of site improvements. Cost new is:
A house has three bedrooms sharing one bathroom, and adding a second bath is economically justified. This is:
Direct costs in a construction budget include:
An appraiser writes that a 40-year-old house has an effective age of 10 but describes original wiring, original kitchen and a 25-year-old roof. The report's problem is:
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