Humber/Ontario Real Estate Course 1 Exam Practice

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Which of the following correctly describes the way remuneration can be structured under REBBA?

Remuneration can be calculated based on the difference between listing and a higher selling price, if so agreed in writing by the seller.
Remuneration can be an agreed flat fee and/or a percentage of the sale/rental price.
Remuneration can be a percentage, or a series of percentages that increase with higher sale prices.
Remuneration is always determined by the government in the absence of a stated rate.
Remuneration must always be a fixed fee.
Remuneration cannot include any commission-based incentives.

The correct answer is: Remuneration can be an agreed flat fee and/or a percentage of the sale/rental price.

The correct characterization of how remuneration can be structured under REBBA is that it can indeed be an agreed flat fee and/or a percentage of the sale or rental price. This flexible approach allows for a variety of remuneration structures to accommodate different agreements between real estate professionals and their clients. Real estate professionals may operate under different business models, which can include fixed fees for specific services or commission structures based on the value of the property. This flexibility facilitates negotiations and allows agents to tailor their services according to the needs of the seller or landlord, making it a practical choice in the industry. Other options describe scenarios that either place undue restrictions on remuneration structures or misrepresent the nature of agreements allowable under REBBA. For instance, remuneration determined solely by the government does not align with the principle of negotiated agreements in real estate transactions, where parties have the freedom to determine the terms of compensation. Similarly, stating that remuneration must always be a fixed fee or that commission incentives are forbidden significantly limits the options for real estate agents and clients, which is not the case under the regulations set by REBBA.