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.   take possession of your home.
B.   foreclose on your property.
C.   sell or lease your home.
D.   have you arrested.
E.   evict you.
Question #2
Credit cards have all the following benefits EXCEPT
A.   security.
B.   convenience.
C.   universal acceptance.
D.   low transaction costs.
E.   reliance on cash.
Question #3
The costs of operating a car include all the following EXCEPT
A.   fuel.
B.   maintenance and repair.
C.   price.
D.   property taxes.
E.   insurance and registration.
Question #4
Buyers should use a home inspection checklist when buying a home.
A.   TRUE
B.   FALSE
Question #5
When you identify the product you want to buy, you should first identify
A.   the cheapest alternative.
B.   the availability of the product.
C.   what need the product will satisfy.
D.   what attributes are most important.
E.   your opportunity cost.
Question #6
With an ARM (adjustable rate mortgage), if interest rates change,
A.   the amount of your payment stays the same.
B.   a payment cap is applied.
C.   you risk negative amortization.
D.   a rate cap is applied.
E.   the amount of your payment changes.
Question #7
If you get into trouble with debt you should first
A.   file for bankruptcy.
B.   inform lenders and get debt counseling.
C.   refinance the loan.
D.   let lenders repossess your financed asset.
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.   small claims court.
E.   a class-action suit.
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.   reinvesting.
B.   direct deposit.
C.   laddering.
D.   time deposit.
E.   segregated savings.

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