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.   have you arrested.
B.   evict you.
C.   foreclose on your property.
D.   sell or lease your home.
E.   take possession of your home.
Question #2
Credit cards have all the following benefits EXCEPT
A.   convenience.
B.   universal acceptance.
C.   low transaction costs.
D.   security.
E.   reliance on cash.
Question #3
The costs of operating a car include all the following EXCEPT
A.   fuel.
B.   insurance and registration.
C.   property taxes.
D.   price.
E.   maintenance and repair.
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.   what attributes are most important.
B.   the cheapest alternative.
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.   a payment cap is applied.
D.   a rate cap is applied.
E.   you risk negative amortization.
Question #7
If you get into trouble with debt you should first
A.   refinance the loan.
B.   file for bankruptcy.
C.   inform lenders and get debt counseling.
D.   sell an asset or borrow to pay off the loan.
E.   let lenders repossess your financed asset.
Question #8
An alternative to a promise of "satisfaction guaranteed" on a product is
A.   a class-action suit.
B.   consumer protection.
C.   small claims court.
D.   a warranty.
E.   caveat emptor.
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.   segregated savings.
B.   laddering.
C.   reinvesting.
D.   direct deposit.
E.   time deposit.

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