Question 1

A personal consumer loan could be used to

Accepted Answer

A)  consolidate several loans into one. 
B)  purchase a car. 
C)  cover a temporary cash shortfall. 
D)  buy a mobile home. 
E)  do all these things. 
A)  consolidate several loans into one. 
B)  purchase a car. 
C)  cover a temporary cash shortfall. 
D)  buy a mobile home. 
E)  do all these things.

Question 2

An installment purchase agreement typically includes a sales contract,a security agreement,a note,and an insurance agreement.

Accepted Answer

A) True 
 B)False

Question 3

Consumers whose debt burden has become very heavy might apply for a(n)

Accepted Answer

A)  personal loan. 
B)  single payment loan. 
C)  buy-down loan. 
D)  consolidation loan. 
E)  interim financing. 
A)  personal loan. 
B)  single payment loan. 
C)  buy-down loan. 
D)  consolidation loan. 
E)  interim financing.

Question 4

Student loan debt can be discharged by filing for bankruptcy.

Accepted Answer

A) True 
 B)False

Question 5

INSTRUCTIONS: Choose the word or phrase in [ ] which will correctly complete the statement. 
-When interest rates are falling,you would prefer a [fixed-rate | variable-rate] loan.

Accepted Answer

A) for the first item 
B) for the second item 
C) if neither item will correctly complete the statement. 
A) for the first item 
B) for the second item 
C) if neither item will correctly complete the statement.

Question 6

A single-payment loan is advantageous only if

Accepted Answer

A)  the interest rate is less than on an installment loan. 
B)  funds will be available to repay the lump sum. 
C)  figured with discount method. 
D)  figured with simple interest method. 
E)  it is unsecured. 
A)  the interest rate is less than on an installment loan. 
B)  funds will be available to repay the lump sum. 
C)  figured with discount method. 
D)  figured with simple interest method. 
E)  it is unsecured.

Question 7

Credit unions dominate the consumer loan market.

Accepted Answer

A) True 
 B)False

Question 8

INSTRUCTIONS: Choose the word or phrase in [ ] which will correctly complete the statement. 
-Loan repayment of a [Perkins | PLUS] loan would not begin until a student is out of school.

Accepted Answer

A) for the first item 
B) for the second item 
C) if neither item will correctly complete the statement. 
A) for the first item 
B) for the second item 
C) if neither item will correctly complete the statement.

Question 9

INSTRUCTIONS: Choose the word or phrase in [ ] which will correctly complete the statement. 
-An [add-on | acceleration] clause allows the lender to demand repayment of the entire debt if the borrower defaults on his payments.

Accepted Answer

A) for the first item 
B) for the second item 
C) if neither item will correctly complete the statement. 
A) for the first item 
B) for the second item 
C) if neither item will correctly complete the statement.

Question 10

INSTRUCTIONS: Choose the word or phrase in [ ] which will correctly complete the statement. 
-The legal method of getting an employer to pay a portion of the borrower's wages to the lender is known as wage [withholding | garnishment].

Accepted Answer

A) for the first item 
B) for the second item 
C) if neither item will correctly complete the statement. 
A) for the first item 
B) for the second item 
C) if neither item will correctly complete the statement.

Question 11

Savings and loan associations are allowed to make loans for things like cars,boats,and motorcycles.

Accepted Answer

A) True 
 B)False

Question 12

Which source of consumer loans specializes in home mortgage lending?

Accepted Answer

A)  Commercial banks 
B)  Credit unions 
C)  Consumer finance companies 
D)  Savings and loan associations 
E)  None of the above 
A)  Commercial banks 
B)  Credit unions 
C)  Consumer finance companies 
D)  Savings and loan associations 
E)  None of the above

Question 13

The most accurate method currently available for calculating the annual percentage rate (APR)on an add-on loan is the Rule of 78.

Accepted Answer

A) True 
 B)False

Question 14

Downward Motors has offered Vicki either a $2,500 rebate or a 2%,4-year loan on the new SUV she is purchasing for $33,000 with a $3,000 down payment.Vicki has done her homework and knows that she can get a 6%,4-year loan at his credit union.Should Vicki take the rebate or the 2% loan from the dealer? (Show your key strokes.)

Accepted Answer

@#IMG-DLM& Taking the rebate and financi

Question 15

In most cases,lenders will liquidate the collateral until the loan is paid.

Accepted Answer

A) True 
 B)False

Question 16

College costs have been escalating faster than the overall rate of inflation.

Accepted Answer

A) True 
 B)False

Question 17

Regarding student loans,which of the following is true?

Accepted Answer

A)  They are available only for undergraduate. 
B)  Parents (or legal guardians)must cosign. 
C)  There is a limit on how much can be borrowed. 
D)  There is a limit on the number of loans one can have. 
E)  Interest does not have to be repaid. 
A)  They are available only for undergraduate. 
B)  Parents (or legal guardians)must cosign. 
C)  There is a limit on how much can be borrowed. 
D)  There is a limit on the number of loans one can have. 
E)  Interest does not have to be repaid.

Question 18

Which of the following are recommended if you loan money to a friend or relative?

Accepted Answer

A)  Do it in a business-like fashion. 
B)  Charge interest if the loan is not to be quickly repaid. 
C)  Be sure both parties understand it is a loan,not a gift. 
D)  Lend only money you can afford to give away. 
E)  All of the above 
A)  Do it in a business-like fashion. 
B)  Charge interest if the loan is not to be quickly repaid. 
C)  Be sure both parties understand it is a loan,not a gift. 
D)  Lend only money you can afford to give away. 
E)  All of the above

Question 19

INSTRUCTIONS: Choose the word or phrase in [ ] which will correctly complete the statement. 
-[Public lenders | private lenders] are more flexible in providing financial relief when borrowers are under pressure.

Accepted Answer

A) for the first item 
B) for the second item 
C) if neither item will correctly complete the statement. 
A) for the first item 
B) for the second item 
C) if neither item will correctly complete the statement.

Question 20

Long-term financial goals often depend on borrowing funds.The type of loan that does not fulfill the long-term goal achievement is ____ loans.

Accepted Answer

A)  consumer 
B)  installment 
C)  automobile 
D)  mortgage 
E)  single payment 
A)  consumer 
B)  installment 
C)  automobile 
D)  mortgage 
E)  single payment

A personal consumer loan could be used to

An installment purchase agreement typically includes a sales contract,a security agreement,a note,and an insurance agreement.

Consumers whose debt burden has become very heavy might apply for a(n)

Student loan debt can be discharged by filing for bankruptcy.

INSTRUCTIONS: Choose the word or phrase in [ ] which will correctly complete the statement. -When interest rates are falling,you would prefer a [fixed-rate | variable-rate] loan.

A single-payment loan is advantageous only if

Credit unions dominate the consumer loan market.

INSTRUCTIONS: Choose the word or phrase in [ ] which will correctly complete the statement. -Loan repayment of a [Perkins | PLUS] loan would not begin until a student is out of school.

INSTRUCTIONS: Choose the word or phrase in [ ] which will correctly complete the statement. -An [add-on | acceleration] clause allows the lender to demand repayment of the entire debt if the borrower defaults on his payments.

INSTRUCTIONS: Choose the word or phrase in [ ] which will correctly complete the statement. -The legal method of getting an employer to pay a portion of the borrower's wages to the lender is known as wage [withholding | garnishment].

Savings and loan associations are allowed to make loans for things like cars,boats,and motorcycles.

Which source of consumer loans specializes in home mortgage lending?

The most accurate method currently available for calculating the annual percentage rate (APR)on an add-on loan is the Rule of 78.

In most cases,lenders will liquidate the collateral until the loan is paid.

College costs have been escalating faster than the overall rate of inflation.

Regarding student loans,which of the following is true?

Which of the following are recommended if you loan money to a friend or relative?

INSTRUCTIONS: Choose the word or phrase in [ ] which will correctly complete the statement. -[Public lenders | private lenders] are more flexible in providing financial relief when borrowers are under pressure.

Long-term financial goals often depend on borrowing funds.The type of loan that does not fulfill the long-term goal achievement is ____ loans.

Understanding the Financial Planning Process

Using Financial Statements and Budgets

Preparing Your Taxes

Managing Your Cash and Savings

Making Automobile and Housing Decisions

Using Credit

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 7: Using Consumer Loans

A personal consumer loan could be used to

An installment purchase agreement typically includes a sales contract,a security agreement,a note,and an insurance agreement.

Consumers whose debt burden has become very heavy might apply for a(n)

Student loan debt can be discharged by filing for bankruptcy.

INSTRUCTIONS: Choose the word or phrase in [ ] which will correctly complete the statement. -When interest rates are falling,you would prefer a [fixed-rate | variable-rate] loan.

A single-payment loan is advantageous only if

Credit unions dominate the consumer loan market.

INSTRUCTIONS: Choose the word or phrase in [ ] which will correctly complete the statement. -Loan repayment of a [Perkins | PLUS] loan would not begin until a student is out of school.

INSTRUCTIONS: Choose the word or phrase in [ ] which will correctly complete the statement. -An [add-on | acceleration] clause allows the lender to demand repayment of the entire debt if the borrower defaults on his payments.

INSTRUCTIONS: Choose the word or phrase in [ ] which will correctly complete the statement. -The legal method of getting an employer to pay a portion of the borrower's wages to the lender is known as wage [withholding | garnishment].

Savings and loan associations are allowed to make loans for things like cars,boats,and motorcycles.

Which source of consumer loans specializes in home mortgage lending?

The most accurate method currently available for calculating the annual percentage rate (APR)on an add-on loan is the Rule of 78.

In most cases,lenders will liquidate the collateral until the loan is paid.

College costs have been escalating faster than the overall rate of inflation.

Regarding student loans,which of the following is true?

Which of the following are recommended if you loan money to a friend or relative?

INSTRUCTIONS: Choose the word or phrase in [ ] which will correctly complete the statement. -[Public lenders | private lenders] are more flexible in providing financial relief when borrowers are under pressure.

Long-term financial goals often depend on borrowing funds.The type of loan that does not fulfill the long-term goal achievement is ____ loans.

Understanding the Financial Planning Process

Using Financial Statements and Budgets

Preparing Your Taxes

Managing Your Cash and Savings

Making Automobile and Housing Decisions

Using Credit

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