- CFA Exams
- CFA Level I Exam
- Topic 9. Portfolio Management
- Learning Module 37. Economics and Investment Markets
- Subject 6. Commercial Real Estate
CFA Practice Question
A commercial property's value is determined by key factors such as ______.
II. its location
III. its interior decorations
IV. the state of the underlying economy
I. its tenants
II. its location
III. its interior decorations
IV. the state of the underlying economy
Correct Answer: II and IV
User Contributed Comments 3
| User | Comment |
|---|---|
| thebkr777 | Can anyone explain? |
| JTuranyi | thebkr777, for II. notes say that location is the single most important determinant of property value, while for IV. reading mentions that real estate market tends to be cyclical --> underlying economy in recession means falling prices and vice versa |
| davidt87 | I. tenants can be kicked out (eventually) - so not a KEY factor III. interior decorations can relatively cheaply be changed - again not a KEY facto |