Question 1

Principle of progression is at work here.

The principle of progression states that the value of a lesser-quality property can be enhanced by the presence of higher-quality properties nearby. In this case, Bernard's home, although the worst on the block, benefits from the overall higher values of the neighboring homes.

A) Principle of progression

This principle accurately describes the situation where Bernard's home gains value due to its location among larger and newer homes. As these neighboring homes are more valued, they positively influence the market perception and value of Bernard's property.

B) Principle of regression

The principle of regression would suggest that a higher-valued property could lose value due to the presence of lower-valued properties nearby. This does not apply to Bernard's situation, as his home is benefiting from the surrounding properties rather than being negatively impacted.

C) Principle of contribution

This principle refers to the idea that the value of a property is determined by the contribution of its individual features. While this principle is relevant in property valuation, it does not explain the enhanced value of Bernard's home due to its location among higher-valued homes.

D) Principle of substitution

The principle of substitution states that a property's value is influenced by the cost of acquiring a similar property. This principle does not apply to Bernard's situation, as the focus here is on the positive effect of surrounding higher-value homes, not on substitution with similar properties.

Conclusion

The principle of progression clearly illustrates why Bernard's home is valued higher due to its location among superior properties. In contrast, the other options either misinterpret the scenario or do not adequately capture the dynamics of value enhancement in real estate. Thus, option A stands as the definitive correct answer in this context.