Question 1

The first step in the auto-buying process should be to

Accepted Answer

A) test drive several cars. 
B) begin negotiations. 
C) consider alternative buying strategies. 
D) decide whether to trade in your used car or to sell it yourself. 
E) research which car best meets your needs. 
A) test drive several cars. 
B) begin negotiations. 
C) consider alternative buying strategies. 
D) decide whether to trade in your used car or to sell it yourself. 
E) research which car best meets your needs.

Question 2

For most homeowners,the most important financial reason for owning a home is

Accepted Answer

A) security for loans. 
B) an inflation hedge. 
C) a tax shelter. 
D) a cash flow item. 
E) psychic income. 
A) security for loans. 
B) an inflation hedge. 
C) a tax shelter. 
D) a cash flow item. 
E) psychic income.

Question 3

If lenders specify a loan-to-value ratio of 70 percent,then a buyer must make a 70% down payment on the purchase of a home.

Accepted Answer

A) True 
 B)False

Question 4

According to federal law,private mortgage insurance on most loans ends automatically once the mortgage is paid down to 78% of the original value of the house.

Accepted Answer

A) True 
 B)False

Question 5

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

Accepted Answer

A) True 
 B)False

Question 6

Choose the word or phrase in [ ] which will correctly complete the statement. Select A for the first item, B for the second item, and C if neither item will correctly complete the statement.
-The most popular type of lease is the [closed-end | open-end] lease.

Accepted Answer

The answer of Choose the word or phrase in [...

Question 7

Choose the word or phrase in [ ] which will correctly complete the statement. Select A for the first item, B for the second item, and C if neither item will correctly complete the statement.
-Homeowners may be able to deduct from their taxable income [mortgage principal | mortgage interest].

Accepted Answer

The answer of Choose the word or phrase in [...

Question 8

Choose the word or phrase in [ ] which will correctly complete the statement. Select A for the first item, B for the second item, and C if neither item will correctly complete the statement.
-Paying mortgage points to get a lower rate of interest makes more sense if you expect to live in a home for a [longer | shorter] period of time.

Accepted Answer

The answer of Choose the word or phrase in [...

Question 9

The ____ would be included in a rental contract or lease agreement.

Accepted Answer

A) amount of the monthly payment 
B) payment date 
C) length of lease agreement 
D) deposit required 
E) all of these 
A) amount of the monthly payment 
B) payment date 
C) length of lease agreement 
D) deposit required 
E) all of these

Question 10

An adjustable rate mortgage with a baseline rate of 4%,a margin of 1%,and an annual cap of 1% would have a mortgage rate no higher than 6% in the second year.

Accepted Answer

A) True 
 B)False

Question 11

Capitalized cost on an auto lease is the same as the price of the car.

Accepted Answer

A) True 
 B)False

Question 12

If you made a down payment of $11,000 on a $110,000 house,the lender no doubt will require ____ as a result of the size of the down payment.

Accepted Answer

A) closing points 
B) a bond 
C) private mortgage insurance (PMI) 
D) application fees 
E) homeowner's insurance 
A) closing points 
B) a bond 
C) private mortgage insurance (PMI) 
D) application fees 
E) homeowner's insurance

Question 13

Choose the word or phrase in [ ] which will correctly complete the statement. Select A for the first item, B for the second item, and C if neither item will correctly complete the statement.
-The [longer | shorter] the period of time you expect to live in a house,the more likely refinancing is a sound financial decision.

Accepted Answer

The answer of Choose the word or phrase in [...

Question 14

Most experts consider extended warranties on new vehicles unnecessary given the relatively long initial warranty periods now offered by most manufacturers.

Accepted Answer

A) True 
 B)False

Question 15

To make a legally binding offer on a car,you must sign a sales contract that specifies the offering price and all the conditions of your offer.

Accepted Answer

A) True 
 B)False

Question 16

Choose the word or phrase in [ ] which will correctly complete the statement. Select A for the first item, B for the second item, and C if neither item will correctly complete the statement.
-The purchase price of the house you are buying is $180,000.A loan-to-value ratio of 90% will produce a mortgage amount of [$162,000 | $180,000].

Accepted Answer

The answer of Choose the word or phrase in [...

Question 17

Gasoline is a variable cost of automobile ownership.

Accepted Answer

A) True 
 B)False

Question 18

To refinance a mortgage,the lender typically requires at least 20% equity in the home.

Accepted Answer

A) True 
 B)False

Question 19

The market price of a house is $125,000 and the homebuyer will borrow $100,000.Two points will equal $2,000.

Accepted Answer

A) True 
 B)False

Question 20

The loss of value in a car over time is called

Accepted Answer

A) maintenance. 
B) loan payments. 
C) sales payments. 
D) commissions. 
E) depreciation. 
A) maintenance. 
B) loan payments. 
C) sales payments. 
D) commissions. 
E) depreciation.

The first step in the auto-buying process should be to

For most homeowners,the most important financial reason for owning a home is

If lenders specify a loan-to-value ratio of 70 percent,then a buyer must make a 70% down payment on the purchase of a home.

According to federal law,private mortgage insurance on most loans ends automatically once the mortgage is paid down to 78% of the original value of the house.

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

Choose the word or phrase in [ ] which will correctly complete the statement. Select A for the first item, B for the second item, and C if neither item will correctly complete the statement. -The most popular type of lease is the [closed-end | open-end] lease.

Choose the word or phrase in [ ] which will correctly complete the statement. Select A for the first item, B for the second item, and C if neither item will correctly complete the statement. -Homeowners may be able to deduct from their taxable income [mortgage principal | mortgage interest].

The ____ would be included in a rental contract or lease agreement.

An adjustable rate mortgage with a baseline rate of 4%,a margin of 1%,and an annual cap of 1% would have a mortgage rate no higher than 6% in the second year.

Capitalized cost on an auto lease is the same as the price of the car.

If you made a down payment of $11,000 on a $110,000 house,the lender no doubt will require ____ as a result of the size of the down payment.

Most experts consider extended warranties on new vehicles unnecessary given the relatively long initial warranty periods now offered by most manufacturers.

To make a legally binding offer on a car,you must sign a sales contract that specifies the offering price and all the conditions of your offer.

Gasoline is a variable cost of automobile ownership.

To refinance a mortgage,the lender typically requires at least 20% equity in the home.

The market price of a house is $125,000 and the homebuyer will borrow $100,000.Two points will equal $2,000.

The loss of value in a car over time is called

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

The first step in the auto-buying process should be to

For most homeowners,the most important financial reason for owning a home is

If lenders specify a loan-to-value ratio of 70 percent,then a buyer must make a 70% down payment on the purchase of a home.

According to federal law,private mortgage insurance on most loans ends automatically once the mortgage is paid down to 78% of the original value of the house.

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

Choose the word or phrase in [ ] which will correctly complete the statement. Select A for the first item, B for the second item, and C if neither item will correctly complete the statement. -The most popular type of lease is the [closed-end | open-end] lease.

Choose the word or phrase in [ ] which will correctly complete the statement. Select A for the first item, B for the second item, and C if neither item will correctly complete the statement. -Homeowners may be able to deduct from their taxable income [mortgage principal | mortgage interest].

The ____ would be included in a rental contract or lease agreement.

An adjustable rate mortgage with a baseline rate of 4%,a margin of 1%,and an annual cap of 1% would have a mortgage rate no higher than 6% in the second year.

Capitalized cost on an auto lease is the same as the price of the car.

If you made a down payment of $11,000 on a $110,000 house,the lender no doubt will require ____ as a result of the size of the down payment.

Most experts consider extended warranties on new vehicles unnecessary given the relatively long initial warranty periods now offered by most manufacturers.

To make a legally binding offer on a car,you must sign a sales contract that specifies the offering price and all the conditions of your offer.

Gasoline is a variable cost of automobile ownership.

To refinance a mortgage,the lender typically requires at least 20% equity in the home.

The market price of a house is $125,000 and the homebuyer will borrow $100,000.Two points will equal $2,000.

The loss of value in a car over time is called

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