Question

To an appraiser, a definition of value is:

Selections

A. A relationship between desirous persons and things desired

B. The ability of one commodity to command other commodities in exchange

C. The present worth of all the rights to future benefits arising from the ownership of property

D. All of the above 

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Answer: D

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5 Keys Summary

• An appraiser’s definition of value is comprehensive, encompassing the relationship between desired objects and desirous persons (demand and utility).

• Value is described as the ability of one commodity to command other commodities in exchange, which is the concept of value in exchange (market value).

• A core definition of value in appraisal is the present worth of all the rights to future benefits arising from property ownership, relating to the Principle of Anticipation.

• Value is generally measured in terms of money, representing what two or more parties are willing and able to pay for an asset or service.

• Because value is determined by multiple elements (Utility, Scarcity, Demand, Transferability) and principles (Anticipation, Change, Substitution), the definition includes all the provided components.

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