Oregon 30-Hour Real Estate Law Practice Test

Maya owns a small graphics shop and has an appreciating asset. Which of the following is her appreciating asset?

1. Her original building

2. The retail addition she put onto the building

3. The equipment she uses

4. The clients on her roster

The correct answer is: The retail addition she put onto the building

The correct choice highlighting Maya's appreciating asset is her retail addition. An appreciating asset is typically one that increases in value over time due to factors such as improvements made to the property, location dynamics, or overall market trends. In this case, the retail addition enhances the original building's value and can potentially lead to increased revenue through higher retail space. Real estate, in general, tends to appreciate, especially if improvements are made to the property. This aligns well with the context of her graphics shop, as the addition not only increases the property's value but also creates a more functional and potentially profitable space. While the original building itself may appreciate in value, the specific improvement through the retail addition suggests a more targeted investment leading to greater appreciation compared to the original structure. Additionally, while the equipment and clients are important assets, they do not typically appreciate in value in the same way that real estate and property improvements do. Equipment usually depreciates over time, and while having a strong client base is valuable, it doesn’t possess intrinsic appreciation as a tangible asset in the way property does.