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.   have you arrested.
C.   evict you.
D.   foreclose on your property.
E.   sell or lease your home.
Question #2
Credit cards have all the following benefits EXCEPT
A.   low transaction costs.
B.   security.
C.   convenience.
D.   reliance on cash.
E.   universal acceptance.
Question #3
The costs of operating a car include all the following EXCEPT
A.   price.
B.   property taxes.
C.   fuel.
D.   insurance and registration.
E.   maintenance and repair.
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.   the cheapest alternative.
C.   your opportunity cost.
D.   what need the product will satisfy.
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 rate cap is applied.
D.   a payment cap is applied.
E.   you risk negative amortization.
Question #7
If you get into trouble with debt you should first
A.   file for bankruptcy.
B.   sell an asset or borrow to pay off the loan.
C.   inform lenders and get debt counseling.
D.   let lenders repossess your financed asset.
E.   refinance the loan.
Question #8
An alternative to a promise of "satisfaction guaranteed" on a product is
A.   a class-action suit.
B.   a warranty.
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.   FALSE
B.   TRUE
Question #10
Diversifying your savings in a series of instruments with different maturities is a strategy known as
A.   direct deposit.
B.   reinvesting.
C.   segregated savings.
D.   time deposit.
E.   laddering.

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