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

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