Question 1

Points paid to secure a mortgage to purchase a primary residence will generally be tax deductible as interest in the year they are paid.

Accepted Answer

A) True 
 B)False  True

Question 2

One can arrange auto loans through

Accepted Answer

A)  auto dealers. 
B)  banks. 
C)  credit unions. 
D)  consumer finance companies. 
E)  all of the above. 
A)  auto dealers. 
B)  banks. 
C)  credit unions. 
D)  consumer finance companies. 
E)  all of the above. E

Question 3

Greg has negotiated a $20,000 price on a new pick-up truck.The manufacturer is offering a $1,500 rebate or 3.9 %,three-year financing.Greg is also able to get 7 %,three-year financing at his credit union.If Greg plans to finance $18,000 over three years,should he take the rebate or the 3.9 % financing?

Accepted Answer

Since the 3.9 % financing saves Greg only $905.76 over the loan period,he should take the $1,500 rebate and finance his new truck through the credit union.

Question 4

Janice wants to buy a new car.The cost is $30,000.At the end of six years,the car is expected to be worth 20% of the original price.

Accepted Answer

a. Value of car = 0.20 * $30,0

Question 5

When shopping for a lease,you want a

Accepted Answer

A)  high capitalized cost 
B)  low capitalize cost 
C)  high money factor 
D)  low residual value 
E)  a and d 
A)  high capitalized cost 
B)  low capitalize cost 
C)  high money factor 
D)  low residual value 
E)  a and d

Question 6

The financing rate on the car you are leasing is called the

Accepted Answer

A)  money factor. 
B)  capitalized cost. 
C)  residual value. 
D)  purchase option. 
E)  capitalized cost reduction. 
A)  money factor. 
B)  capitalized cost. 
C)  residual value. 
D)  purchase option. 
E)  capitalized cost reduction.

Question 7

According to federal law,private mortgage insurance on most loans currently made ends automatically once the mortgage is paid down to 80% of the original value of the house.

Accepted Answer

A) True 
 B)False

Question 8

If you are buying a house that is for sale by the owners,the earnest money goes directly to the seller.

Accepted Answer

A) True 
 B)False

Question 9

Low-balling is a sales technique where the salesperson quotes a low price for a car to get you to make an offer,and negotiates the price upward prior to signing the sales agreement.

Accepted Answer

A) True 
 B)False

Question 10

A money factor of 0.00360 on a lease is equivalent to an annual percentage rate of

Accepted Answer

A)  1.80. 
B)  3.60. 
C)  4.32. 
D)  8.64. 
E)  10.80. 
A)  1.80. 
B)  3.60. 
C)  4.32. 
D)  8.64. 
E)  10.80.

Question 11

The largest single investment you will undertake in your lifetime will probably be the purchase of a house.

Accepted Answer

A) True 
 B)False

Question 12

To research used car prices,you can check one of the popular price guides including:

Accepted Answer

A)  National Automobile Dealers Association (NAD
A)  
B)  Official Used Car Guide 
C)  Edmunds Used Car Prices 
D)  All of the above. 
A)  National Automobile Dealers Association (NAD
A)  
B)  Official Used Car Guide 
C)  Edmunds Used Car Prices 
D)  All of the above.

Question 13

The down payment is typically the only substantial housing cost that must be paid at the time of the purchase.

Accepted Answer

A) True 
 B)False

Question 14

Security deposits are controlled by the tenant.

Accepted Answer

A) True 
 B)False

Question 15

INSTRUCTIONS: Choose the word or phrase in [ ] which will correctly complete the statement. Select
-A major variable cost of owning a car is [the loan payment | gasoline].

Accepted Answer

A) for the first item 
B) for the second item 
C) if neither item will correctly complete the 
A) for the first item 
B) for the second item 
C) if neither item will correctly complete the

Question 16

A loan-to-value ratio of 90 percent would require a buyer to make a 90% down payment.

Accepted Answer

A) True 
 B)False

Question 17

Reasons why auto leasing is so popular include all of the following except:

Accepted Answer

A)  lower monthly payments 
B)  lower down payment 
C)  lower total cost 
D)  getting more expensive car for the same monthly payment 
E)  rising new car prices 
A)  lower monthly payments 
B)  lower down payment 
C)  lower total cost 
D)  getting more expensive car for the same monthly payment 
E)  rising new car prices

Question 18

Advantages of buying a used car rather than a new car include

Accepted Answer

A)  good mechanical condition. 
B)  will depreciate less quickly. 
C)  more choices available. 
D)  cost. 
E)  all of the above. 
A)  good mechanical condition. 
B)  will depreciate less quickly. 
C)  more choices available. 
D)  cost. 
E)  all of the above.

Question 19

INSTRUCTIONS: Choose the word or phrase in [ ] which will correctly complete the statement. Select
-As a homeowner,you can deduct the mortgage interest and [property taxes | property insurance] if you itemize on your federal taxes.

Accepted Answer

A) for the first item 
B) for the second item 
C) if neither item will correctly complete the 
A) for the first item 
B) for the second item 
C) if neither item will correctly complete the

Question 20

As home prices have fallen in recent year,the rent ratio

Accepted Answer

A)  has increased and rent affordability has increased 
B)  has decreased and rent affordability has decreased 
C)  has increased and rent affordability has decreased 
D)  has decreased and rent affordability has increased 
A)  has increased and rent affordability has increased 
B)  has decreased and rent affordability has decreased 
C)  has increased and rent affordability has decreased 
D)  has decreased and rent affordability has increased

Points paid to secure a mortgage to purchase a primary residence will generally be tax deductible as interest in the year they are paid.

One can arrange auto loans through

Janice wants to buy a new car.The cost is $30,000.At the end of six years,the car is expected to be worth 20% of the original price.

When shopping for a lease,you want a

The financing rate on the car you are leasing is called the

According to federal law,private mortgage insurance on most loans currently made ends automatically once the mortgage is paid down to 80% of the original value of the house.

If you are buying a house that is for sale by the owners,the earnest money goes directly to the seller.

Low-balling is a sales technique where the salesperson quotes a low price for a car to get you to make an offer,and negotiates the price upward prior to signing the sales agreement.

A money factor of 0.00360 on a lease is equivalent to an annual percentage rate of

The largest single investment you will undertake in your lifetime will probably be the purchase of a house.

To research used car prices,you can check one of the popular price guides including:

The down payment is typically the only substantial housing cost that must be paid at the time of the purchase.

Security deposits are controlled by the tenant.

INSTRUCTIONS: Choose the word or phrase in [ ] which will correctly complete the statement. Select -A major variable cost of owning a car is [the loan payment | gasoline].

A loan-to-value ratio of 90 percent would require a buyer to make a 90% down payment.

Reasons why auto leasing is so popular include all of the following except:

Advantages of buying a used car rather than a new car include

INSTRUCTIONS: Choose the word or phrase in [ ] which will correctly complete the statement. Select -As a homeowner,you can deduct the mortgage interest and [property taxes | property insurance] if you itemize on your federal taxes.

As home prices have fallen in recent year,the rent ratio

Understanding the Financial Planning Process

Using Financial Statements and Budgets

Preparing Your Taxes

Managing Your Cash and Savings

Using Credit

Using Consumer Loans

Insuring Your Life

Insuring Your Health

Protecting Your Property

Investment Planning

Investing in Stocks and Bonds

Investing in Mutual Funds

Planning for Retirement

Preserving Your Estate

Filters

Exam 5: Making Automobile and Housing Decisions

Points paid to secure a mortgage to purchase a primary residence will generally be tax deductible as interest in the year they are paid.

One can arrange auto loans through

Janice wants to buy a new car.The cost is $30,000.At the end of six years,the car is expected to be worth 20% of the original price.

When shopping for a lease,you want a

The financing rate on the car you are leasing is called the

According to federal law,private mortgage insurance on most loans currently made ends automatically once the mortgage is paid down to 80% of the original value of the house.

If you are buying a house that is for sale by the owners,the earnest money goes directly to the seller.

Low-balling is a sales technique where the salesperson quotes a low price for a car to get you to make an offer,and negotiates the price upward prior to signing the sales agreement.

A money factor of 0.00360 on a lease is equivalent to an annual percentage rate of

The largest single investment you will undertake in your lifetime will probably be the purchase of a house.

To research used car prices,you can check one of the popular price guides including:

The down payment is typically the only substantial housing cost that must be paid at the time of the purchase.

Security deposits are controlled by the tenant.

INSTRUCTIONS: Choose the word or phrase in [ ] which will correctly complete the statement. Select -A major variable cost of owning a car is [the loan payment | gasoline].

A loan-to-value ratio of 90 percent would require a buyer to make a 90% down payment.

Reasons why auto leasing is so popular include all of the following except:

Advantages of buying a used car rather than a new car include

INSTRUCTIONS: Choose the word or phrase in [ ] which will correctly complete the statement. Select -As a homeowner,you can deduct the mortgage interest and [property taxes | property insurance] if you itemize on your federal taxes.

As home prices have fallen in recent year,the rent ratio

Understanding the Financial Planning Process

Using Financial Statements and Budgets

Preparing Your Taxes

Managing Your Cash and Savings

Using Credit

Using Consumer Loans

Insuring Your Life

Insuring Your Health

Protecting Your Property

Investment Planning

Investing in Stocks and Bonds

Investing in Mutual Funds

Planning for Retirement

Preserving Your Estate

Filters