Fin 008 - Personal Finance and Investments » Winter 2021 » Quiz 3

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Question #1
If you miss payments and default on your mortgage, the lender can do all the following EXCEPT
A.   sell or lease your home.
B.   take possession of your home.
C.   foreclose on your property.
D.   evict you.
E.   have you arrested.
Question #2
Credit cards have all the following benefits EXCEPT
A.   convenience.
B.   universal acceptance.
C.   reliance on cash.
D.   security.
E.   low transaction costs.
Question #3
The costs of operating a car include all the following EXCEPT
A.   fuel.
B.   property taxes.
C.   maintenance and repair.
D.   price.
E.   insurance and registration.
Question #4
Buyers should use a home inspection checklist when buying a home.
A.   FALSE
B.   TRUE
Question #5
When you identify the product you want to buy, you should first identify
A.   your opportunity cost.
B.   what attributes are most important.
C.   the availability of the product.
D.   the cheapest alternative.
E.   what need the product will satisfy.
Question #6
With an ARM (adjustable rate mortgage), if interest rates change,
A.   a rate cap is applied.
B.   you risk negative amortization.
C.   the amount of your payment stays the same.
D.   the amount of your payment changes.
E.   a payment cap is applied.
Question #7
If you get into trouble with debt you should first
A.   file for bankruptcy.
B.   let lenders repossess your financed asset.
C.   inform lenders and get debt counseling.
D.   refinance the loan.
E.   sell an asset or borrow to pay off the loan.
Question #8
An alternative to a promise of "satisfaction guaranteed" on a product is
A.   a warranty.
B.   consumer protection.
C.   caveat emptor.
D.   a class-action suit.
E.   small claims court.
Question #9
After understanding what you need in a home, the next step is to determine how much house you can afford.
A.   TRUE
B.   FALSE
Question #10
Diversifying your savings in a series of instruments with different maturities is a strategy known as
A.   direct deposit.
B.   laddering.
C.   time deposit.
D.   segregated savings.
E.   reinvesting.

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