Question 1

The greatest fixed cost involved with owning an automobile is usually the monthly loan payments.

Accepted Answer

A) True 
 B)False

Question 2

____ is a reason for preferring to rent rather than to buy.

Accepted Answer

A)  Mobility 
B)  No maintenance worries 
C)  Lower monthly cash flows 
D)  Down payment money better used elsewhere 
E)  All of these are reasons 
A)  Mobility 
B)  No maintenance worries 
C)  Lower monthly cash flows 
D)  Down payment money better used elsewhere 
E)  All of these are reasons

Question 3

Choose the word or phrase in [ ] which will correctly complete the statement. Select A for the first item, B for the second item, and C if neither item will correctly complete the statement.
-A major variable cost of owning a car is [the loan payment | gasoline].

Accepted Answer

The answer of Choose the word or phrase in [...

Question 4

Jana has $1,500 for a down payment and thinks she can afford monthly payments of $300.If she can finance a vehicle with a 7%,4-year loan,what is the maximum loan amount Jana can afford?

Accepted Answer

A)  $12,528 
B)  $14,208 
C)  $16,028 
D)  $17,900 
E)  $18,028 
A)  $12,528 
B)  $14,208 
C)  $16,028 
D)  $17,900 
E)  $18,028

Question 5

Choose the word or phrase in [ ] which will correctly complete the statement. Select A for the first item, B for the second item, and C if neither item will correctly complete the statement.
-The term condominium/townhome refers to a type of [architecture | ownership].

Accepted Answer

The answer of Choose the word or phrase in [...

Question 6

Choose the word or phrase in [ ] which will correctly complete the statement. Select A for the first item, B for the second item, and C if neither item will correctly complete the statement.
-The average cost of owning is typically much less than leasing if you own the vehicle over [two | four] years.

Accepted Answer

The answer of Choose the word or phrase in [...

Question 7

A short sale does not affect a distressed homeowner's credit score as much as a foreclosure.

Accepted Answer

A) True 
 B)False

Question 8

Condominium and Townhome owners can deduct real estate taxes and mortgage interest on their federal income taxes but co-op owners cannot take these deductions.

Accepted Answer

A) True 
 B)False

Question 9

Graduated payment mortgages and growing equity mortgages are both examples of adjustable-rate mortgages.

Accepted Answer

A) True 
 B)False

Question 10

The monthly mortgage payment divided by your monthly gross income equals an affordability ratio.

Accepted Answer

A) True 
 B)False

Question 11

Choose the word or phrase in [ ] which will correctly complete the statement. Select A for the first item, B for the second item, and C if neither item will correctly complete the statement.
-A convertible ARM will have a [higher | lower] interest rate than a traditional ARM.

Accepted Answer

The answer of Choose the word or phrase in [...

Question 12

Which of the following are reasons people lease vehicles?

Accepted Answer

A)  Leasing is generally less expensive than buying. 
B)  Monthly payments for leases are generally less expensive than loan payments. 
C)  One can afford a more expensive car with the same monthly payment by leasing rather than buying. 
D)  b and c only 
E)  a, b, and c 
A)  Leasing is generally less expensive than buying. 
B)  Monthly payments for leases are generally less expensive than loan payments. 
C)  One can afford a more expensive car with the same monthly payment by leasing rather than buying. 
D)  b and c only 
E)  a, b, and c

Question 13

A lender will generally require mortgage insurance if the down payment is less than 20 percent.

Accepted Answer

A) True 
 B)False

Question 14

Most lenders do not want mortgage payments to exceed ____ percent of your gross monthly income.

Accepted Answer

A)  10-15 
B)  15-18 
C)  25-30 
D)  30-33 
E)  33-38 
A)  10-15 
B)  15-18 
C)  25-30 
D)  30-33 
E)  33-38

Question 15

Henry has $2,500 for a down payment and thinks he can afford monthly payments of $400.If he can finance a vehicle with an 8%,3-year loan,what is the maximum amount Henry can spend on the car?

Accepted Answer

A)  $12,765 
B)  $14,400 
C)  $14,079 
D)  $15,265 
E)  $16,879 
A)  $12,765 
B)  $14,400 
C)  $14,079 
D)  $15,265 
E)  $16,879

Question 16

An adjustable rate mortgage with a baseline rate of 4%,a margin of 1%,and an annual cap of 1% would have an initial mortgage rate no higher than 6%.

Accepted Answer

A) True 
 B)False

Question 17

A fee charged by lenders as a condition of a mortgage loan that effectively raises the interest rate is called

Accepted Answer

A)  mortgage points. 
B)  a down payment. 
C)  a commission. 
D)  an add-on charge. 
E)  loan fee. 
A)  mortgage points. 
B)  a down payment. 
C)  a commission. 
D)  an add-on charge. 
E)  loan fee.

Question 18

In a co-op,the buyer receives title to a unit and joint ownership of the common areas.

Accepted Answer

A) True 
 B)False

Question 19

____ and ____ are often paid as part of one's house payment and held in an escrow account.

Accepted Answer

A)  Closing costs; interest 
B)  Insurance; real estate taxes 
C)  Principal; interest 
D)  Insurance; utilities 
E)  Utilities; real estate taxes 
A)  Closing costs; interest 
B)  Insurance; real estate taxes 
C)  Principal; interest 
D)  Insurance; utilities 
E)  Utilities; real estate taxes

Question 20

____ could be deducted on your Federal income taxes.

Accepted Answer

A)  Rent payments 
B)  Homeowner's insurance 
C)  Real estate taxes 
D)  Utility bills 
E)  None of these 
A)  Rent payments 
B)  Homeowner's insurance 
C)  Real estate taxes 
D)  Utility bills 
E)  None of these

The greatest fixed cost involved with owning an automobile is usually the monthly loan payments.

____ is a reason for preferring to rent rather than to buy.

Choose the word or phrase in [ ] which will correctly complete the statement. Select A for the first item, B for the second item, and C if neither item will correctly complete the statement. -A major variable cost of owning a car is [the loan payment | gasoline].

Jana has $1,500 for a down payment and thinks she can afford monthly payments of $300.If she can finance a vehicle with a 7%,4-year loan,what is the maximum loan amount Jana can afford?

Choose the word or phrase in [ ] which will correctly complete the statement. Select A for the first item, B for the second item, and C if neither item will correctly complete the statement. -The term condominium/townhome refers to a type of [architecture | ownership].

A short sale does not affect a distressed homeowner's credit score as much as a foreclosure.

Condominium and Townhome owners can deduct real estate taxes and mortgage interest on their federal income taxes but co-op owners cannot take these deductions.

Graduated payment mortgages and growing equity mortgages are both examples of adjustable-rate mortgages.

The monthly mortgage payment divided by your monthly gross income equals an affordability ratio.

Choose the word or phrase in [ ] which will correctly complete the statement. Select A for the first item, B for the second item, and C if neither item will correctly complete the statement. -A convertible ARM will have a [higher | lower] interest rate than a traditional ARM.

Which of the following are reasons people lease vehicles?

A lender will generally require mortgage insurance if the down payment is less than 20 percent.

Most lenders do not want mortgage payments to exceed ____ percent of your gross monthly income.

Henry has $2,500 for a down payment and thinks he can afford monthly payments of $400.If he can finance a vehicle with an 8%,3-year loan,what is the maximum amount Henry can spend on the car?

An adjustable rate mortgage with a baseline rate of 4%,a margin of 1%,and an annual cap of 1% would have an initial mortgage rate no higher than 6%.

A fee charged by lenders as a condition of a mortgage loan that effectively raises the interest rate is called

In a co-op,the buyer receives title to a unit and joint ownership of the common areas.

and are often paid as part of one's house payment and held in an escrow account.

____ could be deducted on your Federal income taxes.

Understanding the Financial Planning Process

Using Financial Statements and Budgets

Preparing Your Taxes

Managing Your Cash and Savings

Using Credit

Using Consumer Loans

Insuring Your Life

Insuring Your Health

Protecting Your Property

Investment Planning

Investing in Stocks and Bonds

Investing in Mutual Funds

Planning for Retirement

Preserving Your Estate

Filters

Exam 5: Making Automobile and Housing Decisions

The greatest fixed cost involved with owning an automobile is usually the monthly loan payments.

____ is a reason for preferring to rent rather than to buy.

Choose the word or phrase in [ ] which will correctly complete the statement. Select A for the first item, B for the second item, and C if neither item will correctly complete the statement. -A major variable cost of owning a car is [the loan payment | gasoline].

Jana has $1,500 for a down payment and thinks she can afford monthly payments of $300.If she can finance a vehicle with a 7%,4-year loan,what is the maximum loan amount Jana can afford?

Choose the word or phrase in [ ] which will correctly complete the statement. Select A for the first item, B for the second item, and C if neither item will correctly complete the statement. -The term condominium/townhome refers to a type of [architecture | ownership].

A short sale does not affect a distressed homeowner's credit score as much as a foreclosure.

Condominium and Townhome owners can deduct real estate taxes and mortgage interest on their federal income taxes but co-op owners cannot take these deductions.

Graduated payment mortgages and growing equity mortgages are both examples of adjustable-rate mortgages.

The monthly mortgage payment divided by your monthly gross income equals an affordability ratio.

Choose the word or phrase in [ ] which will correctly complete the statement. Select A for the first item, B for the second item, and C if neither item will correctly complete the statement. -A convertible ARM will have a [higher | lower] interest rate than a traditional ARM.

Which of the following are reasons people lease vehicles?

A lender will generally require mortgage insurance if the down payment is less than 20 percent.

Most lenders do not want mortgage payments to exceed ____ percent of your gross monthly income.

Henry has $2,500 for a down payment and thinks he can afford monthly payments of $400.If he can finance a vehicle with an 8%,3-year loan,what is the maximum amount Henry can spend on the car?

An adjustable rate mortgage with a baseline rate of 4%,a margin of 1%,and an annual cap of 1% would have an initial mortgage rate no higher than 6%.

A fee charged by lenders as a condition of a mortgage loan that effectively raises the interest rate is called

In a co-op,the buyer receives title to a unit and joint ownership of the common areas.

____ and ____ are often paid as part of one's house payment and held in an escrow account.

____ could be deducted on your Federal income taxes.

Understanding the Financial Planning Process

Using Financial Statements and Budgets

Preparing Your Taxes

Managing Your Cash and Savings

Using Credit

Using Consumer Loans

Insuring Your Life

Insuring Your Health

Protecting Your Property

Investment Planning

Investing in Stocks and Bonds

Investing in Mutual Funds

Planning for Retirement

Preserving Your Estate

Filters

and are often paid as part of one's house payment and held in an escrow account.