When market value is the objective, what related opinion must be developed alongside it?
Correct Answer
D) An opinion of reasonable exposure time linked to the value conclusion
Why this is correct: Market value definitions assume exposure to the market, so USPAP requires an opinion of reasonable exposure time—the marketing period presumed to have occurred prior to the effective date—linked to the value conclusion, as stated originally. Why the other choices are wrong: "A formally guaranteed minimum resale price that the lender can rely upon" is incorrect; appraisals do not guarantee future prices. "The property's assessed value for taxes" is unrelated to market value. "An insurance replacement cost estimate" is a different valuation purpose. Exam tip: Exposure time is retrospective and integral to market value.
Why This Is the Correct Answer
Why this is correct: Market value definitions assume exposure to the market, so USPAP requires an opinion of reasonable exposure time—the marketing period presumed to have occurred prior to the effective date—linked to the value conclusion, as stated originally. Why the other choices are wrong: "A formally guaranteed minimum resale price that the lender can rely upon" is incorrect; appraisals do not guarantee future prices. "The property's assessed value for taxes" is unrelated to market value. "An insurance replacement cost estimate" is a different valuation purpose. Exam tip: Exposure time is retrospective and integral to market value.
More USPAP Questions
Which statement best defines a hypothetical condition under USPAP?
According to the Competency Rule, if an appraiser lacks the knowledge and experience to complete an assignment competently, which action is NOT acceptable?
An appraiser runs only the sales comparison approach on a standard tract home and omits the cost and income approaches. Under Standard 1 this is:
A value opinion for a subdivision as if fully built out two years from now is what kind of assignment, and what does it require?
A hypothetical condition differs from an extraordinary assumption in that a hypothetical condition:
An appraiser must disclose in the certification whether they have:
A client-imposed requirement — 'use only comps from our approved list' — is best described as:
Under Standard 1, when developing a real property appraisal, an appraiser must:
The certification required by Standards Rule 2-3 must be signed by:
According to Standard 1, when developing an opinion of market value, an appraiser must analyze:
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