Certified Apartment Portfolio Supervisor (CAPS) Practice Exam - Module 2

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Prepare for the CAPS Exam with a comprehensive study of Module 2. Utilize our practice resources filled with flashcards, multiple choice questions, and thorough explanations to ensure your success!

Each practice test/flash card set has 50 randomly selected questions from a bank of over 500. You'll get a new set of questions each time!

Practice this question and more.

Which of the following describes fixed expenses?

Costs that vary with occupancy levels
Costs that are controllable by management
Costs that remain constant regardless of occupancy
Costs that include variable rates for services

The correct answer is: Costs that remain constant regardless of occupancy

Fixed expenses refer to costs that do not fluctuate in relation to the occupancy levels of a property. This means that regardless of how many units are rented or how many residents occupy the apartments, these expenses remain stable and must be paid. Typically, fixed expenses include items such as property taxes, insurance, and salaries for management staff, which are incurred irrespective of the property’s occupancy status. Understanding fixed expenses is crucial for financial planning and stability in property management, as they represent a consistent portion of a property's operating budget.