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.   sell or lease your home.
C.   evict you.
D.   foreclose on your property.
E.   have you arrested.
Question #2
Credit cards have all the following benefits EXCEPT
A.   convenience.
B.   universal acceptance.
C.   security.
D.   reliance on cash.
E.   low transaction costs.
Question #3
The costs of operating a car include all the following EXCEPT
A.   property taxes.
B.   maintenance and repair.
C.   insurance and registration.
D.   fuel.
E.   price.
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.   what attributes are most important.
C.   what need the product will satisfy.
D.   your opportunity cost.
E.   the availability of the product.
Question #6
With an ARM (adjustable rate mortgage), if interest rates change,
A.   the amount of your payment changes.
B.   the amount of your payment stays the same.
C.   you risk negative amortization.
D.   a rate cap is applied.
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.   sell an asset or borrow to pay off the loan.
E.   refinance the loan.
Question #8
An alternative to a promise of "satisfaction guaranteed" on a product is
A.   a warranty.
B.   a class-action suit.
C.   caveat emptor.
D.   consumer protection.
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.   segregated savings.
C.   reinvesting.
D.   time deposit.
E.   laddering.

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