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

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