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.   have you arrested.
C.   take possession of your home.
D.   foreclose on your property.
E.   evict you.
Question #2
Credit cards have all the following benefits EXCEPT
A.   universal acceptance.
B.   convenience.
C.   reliance on cash.
D.   security.
E.   low transaction costs.
Question #3
The costs of operating a car include all the following EXCEPT
A.   insurance and registration.
B.   property taxes.
C.   maintenance and repair.
D.   price.
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.   the availability of the product.
B.   what need the product will satisfy.
C.   the cheapest alternative.
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.   a payment cap is applied.
C.   the amount of your payment stays the same.
D.   the amount of your payment changes.
E.   a rate 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.   inform lenders and get debt counseling.
D.   file for bankruptcy.
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.   caveat emptor.
B.   a class-action suit.
C.   a warranty.
D.   small claims court.
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.   reinvesting.
C.   time deposit.
D.   segregated savings.
E.   direct deposit.

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