Question 1

Which of the following observations concerning mortgages is NOT valid?

Accepted Answer

A) They may refer to loans secured by lien on residential houses. 
B) They are a minor component in finance company portfolios. 
C) Mortgage-backed securities are created by securitization. 
D) Home equity loans are examples of second mortgages. 
E) The interest on a mortgage loan secured by a primary residence is not tax deductible to the homeowner. 
A) They may refer to loans secured by lien on residential houses. 
B) They are a minor component in finance company portfolios. 
C) Mortgage-backed securities are created by securitization. 
D) Home equity loans are examples of second mortgages. 
E) The interest on a mortgage loan secured by a primary residence is not tax deductible to the homeowner.

Question 2

Traditionally, motor vehicle loans and leases are the largest category of consumer loans for finance companies.

Accepted Answer

A) True 
 B)False

Question 3

Which of the following is NOT a type of finance company?

Accepted Answer

A) Sales finance institutions. 
B) Personal credit institutions. 
C) Business credit institutions. 
D) Captive finance company. 
E) All of the options are types of finance companies. 
A) Sales finance institutions. 
B) Personal credit institutions. 
C) Business credit institutions. 
D) Captive finance company. 
E) All of the options are types of finance companies.

Question 4

As an industry, finance companies have escaped the merger and consolidation activity that has affected nearly every other sector of the financial services industry.

Accepted Answer

A) True 
 B)False

Question 5

Finance companies often prefer to lease equipment to customers because

Accepted Answer

A) repossession in the event of default is easier. 
B) a lease with little or no down payment is more attractive to business customers. 
C) the finance company receives the benefit of depreciation expense. 
D) All of the options. 
E) repossession in the event of default is easier and the finance company receives the benefit of depreciation expense. 
A) repossession in the event of default is easier. 
B) a lease with little or no down payment is more attractive to business customers. 
C) the finance company receives the benefit of depreciation expense. 
D) All of the options. 
E) repossession in the event of default is easier and the finance company receives the benefit of depreciation expense.

Which of the following observations concerning mortgages is NOT valid?

Traditionally, motor vehicle loans and leases are the largest category of consumer loans for finance companies.

Which of the following is NOT a type of finance company?

As an industry, finance companies have escaped the merger and consolidation activity that has affected nearly every other sector of the financial services industry.

Finance companies often prefer to lease equipment to customers because

Why Are Financial Institutions Special

Financial Services: Depository Institutions

Financial Services: Securities Brokerage and Investment Banking

Financial Services: Mutual Funds and Hedge Funds

Financial Services: Insurance

Risks of Financial Institutions

Interest Rate Risk I

Interest Rate Risk II

Credit Risk: Individual Loan Risk

Credit Risk: Loan Portfolio and Concentration Risk

Liquidity Risk

Foreign Exchange Risk

Sovereign Risk

Market Risk

Off-Balance-Sheet Risk

Technology and Other Operational Risks

Fintech Risks

Liability and Liquidity Management

Deposit Insurance and Other Liability Guarantees

Capital Adequacy

Product and Geographic Expansion

Futures and Forwards

Options, Caps, Floors, and Collars

Swaps

Loan Sales

Securitization

Filters

Exam 3: Financial Services: Finance Companies

Which of the following observations concerning mortgages is NOT valid?

Traditionally, motor vehicle loans and leases are the largest category of consumer loans for finance companies.

Which of the following is NOT a type of finance company?

As an industry, finance companies have escaped the merger and consolidation activity that has affected nearly every other sector of the financial services industry.

Finance companies often prefer to lease equipment to customers because

Why Are Financial Institutions Special

Financial Services: Depository Institutions

Financial Services: Securities Brokerage and Investment Banking

Financial Services: Mutual Funds and Hedge Funds

Financial Services: Insurance

Risks of Financial Institutions

Interest Rate Risk I

Interest Rate Risk II

Credit Risk: Individual Loan Risk

Credit Risk: Loan Portfolio and Concentration Risk

Liquidity Risk

Foreign Exchange Risk

Sovereign Risk

Market Risk

Off-Balance-Sheet Risk

Technology and Other Operational Risks

Fintech Risks

Liability and Liquidity Management

Deposit Insurance and Other Liability Guarantees

Capital Adequacy

Product and Geographic Expansion

Futures and Forwards

Options, Caps, Floors, and Collars

Swaps

Loan Sales

Securitization

Filters