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

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