Florida Real Estate Practice Exam

Which economic characteristic of land refers to the concept that a land's value can be affected by changes made to it?

1. Improvements

2. Permanence of investment

3. Scarcity

4. Situs (location)

The correct answer is: Improvements

The correct answer is Improvements Improvements are changes made to a land that can add value to it. These changes can include constructing buildings, houses, and other amenities that make the land more useful and attractive. This increases the demand for the land, and consequently, its value. The other options, permanence of investment, scarcity, and situs (location), do not directly refer to changes made to the land. Permanence of investment refers to the long-term nature of investments in land, while scarcity refers to the limited supply of land. Situs, also known as location, refers to the geographical and economic factors that affect the value of a land, but not necessarily changes made to it. Therefore, improvements are the unique economic characteristic of land that involves changes made to it directly impacting its value.