Precious Metals & Market Valuation Flashcards

An appraiser is asked for a 'fair market value' of a gold ingot. Which scenario best defines this value?

Answer: The price a willing buyer and seller agree upon, both informed and unpressured

Fair market value (FMV) is the hypothetical price agreed upon by a knowledgeable, willing buyer and seller with no compulsion to transact.

Gold futures contracts traded on the COMEX are standardized at how many troy ounces per contract?

Answer: 100 troy ounces

A standard COMEX gold futures contract represents 100 troy ounces of gold.

Which precious metal has the highest density among commonly used jewelry metals?

Answer: Iridium

Iridium has a density of approximately 22.56 g/cm³, making it denser than platinum (21.45 g/cm³) and gold (19.32 g/cm³).

When assessing the value of a vintage gold brooch, the appraiser should consider all of the following EXCEPT:

Answer: The current spot price of rhodium

Rhodium spot price is irrelevant to a gold brooch appraisal unless it has significant rhodium plating, which vintage pieces rarely do.

A client's platinum ring tests positive for platinum but weighs significantly less than expected for its size. What is the most likely explanation?

Answer: The setting contains hollow areas or a lower-density core metal

Hollow construction or a base-metal core reduces overall weight while maintaining the appearance and surface material of solid platinum.

What does the term 'fineness' mean when applied to precious metals?

Answer: The purity of the metal expressed in parts per thousand

Fineness is the measure of precious metal purity expressed as parts per thousand (e.g., 999 fine gold = 99.9% pure gold).

Gold's resistance to corrosion and tarnish is primarily due to its:

Answer: High ionization energy and chemical nobility

Gold's high ionization energy makes it extremely resistant to chemical reactions, classifying it as a noble metal that does not oxidize or corrode under normal conditions.