Deck 6: Consumer Purchasing Strategies and Wise Buying of Motor Vehicles

Question 1

Thomas bought a toaster that would not toast bread,and he returned it.The manufacturer accepted the return because it was defective and came with a full warranty.

Answer 1

True

Question 2

One of the first steps in a car purchase negotiation should be a discussion of the trade-in vehicle.

Answer 2

False

Question 3

A lease for a car is typically for three to five years.

Answer 3

True

Question 4

A clear statement of a problem is "I need to have a car."

Question 5

Thomas bought a vehicle from a used car dealer.He returned it to the dealer because the transmission fell out 150 miles after he purchased it.The dealer refused to accept the return because the vehicle was sold "as is." This is an example of a limited warranty.

Question 6

One of the best ways to compare packaged food products is to use rebate pricing.

Question 7

A vehicle that looks rusty on the outside may hide a well-maintained engine.

Question 8

Abigail checked out brands and prices of blue jeans at several stores.She was comparison shopping.

Question 9

Abigail checked out brands and prices of blue jeans at several stores.She was impulse shopping.

Question 10

An aesthetic feature of a vehicle is air conditioning.

Question 11

Prices at the local quick market (convenience store)will probably be lower than at the regional big box retailer (grocery store).

Question 12

The phases of buying are problem identification,preshopping activities,evaluating alternatives,selection and purchase,and postpurchase activities.

Question 13

A convenience option that consumers may look for in a vehicle is special trim.

Question 14

The only way that you can have long-term financial security is to not save all of your current income.

Question 15

An example of a "preshopping activity" is negotiating the price of a product.

Question 16

A vehicle that looks rusty on the outside will have major operational problems.

Question 17

An advantage of a lease over a purchase is that the buyer can usually obtain a more expensive vehicle for the same monthly payment.

Question 18

Cam has an overwhelming desire to buy things whenever he goes shopping.One could say that he is a compulsive shopper.

Question 19

Service contracts on vehicles usually are wise financial decisions.

Question 20

A service contract is frequently called an extended warranty even though service contracts are not warranties.

Question 21

The largest fixed expense associated with a new automobile is depreciation.

Question 22

Lemon laws have been enacted in 48 of the 50 states for new vehicle purchases.

Question 23

When Jane researched the brands and prices of refrigerators,she was

A) Comparison shopping.
B) Compulsive shopping.
C) Impulse shopping.
D) Trade-off shopping.
E) Warranty shopping.

Question 24

If you have a problem with a product and you really want to get the attention of someone in customer service,you should raise your voice during your conversation.

Question 25

The settlement of a difference by a mediator is legally binding.

Question 26

The best place to find a qualified lawyer who will meet your specific needs is a phone book.

Question 27

Studies of consumer problems consistently rank auto repairs as one of the best consumer services with few consumer complaints.

Question 28

Jacob drives by a Big Box home improvement center on his way home from work.He usually stops and buys something because it makes him feel good.Jacob is

A) Comparison shopping.
B) Compulsive shopping.
C) Impulse shopping.
D) Trade-off shopping.
E) Warranty shopping.

Question 29

Tracy went to a local restaurant and became ill from the meal she ate.She can contact her city or county health department to handle problems with the restaurant.

Question 30

One of the best places to find a qualified lawyer who will meet your specific needs is referrals from friends.

Question 31

Small claims court is used to take legal action by a few individuals on behalf of all who have suffered the same alleged injustice.

Question 32

The settlement of a difference by an arbitrator is legally binding.

Question 33

A trade-in vehicle should NOT be mentioned until the cost of a new car has been settled.

Question 34

People do not anticipate problems with purchases but should be prepared for them.

Question 35

If you have a problem with a product,the first place you should express your dissatisfaction to is the corporate headquarters.

Question 36

A good time to use a lawyer is when you appear in small claims court.

Question 37

The best time to ask a lawyer about his fees is after he wins a case for you.

Question 38

If you are somewhat interested in a specific vehicle,you should provide a small deposit so the car seller will hold the vehicle for you.

Question 39

Joe bought some cheese at his local grocery store.After he brought it home,he noticed it was moldy even though the expiration date was still three weeks away.He should call the toll-free hotline number printed on the package to tell the company about the problem he encountered.

Question 40

While Paul was shopping for a new chainsaw,he found a great deal on a new drill and bought it.This is an example of

A) Comparison shopping.
B) Compulsive shopping.
C) Impulse shopping.
D) Trade-off shopping.
E) Warranty shopping.

Question 41

Most products come with some guarantee of quality.This type of warranty covers the product's intended use or other basic understandings that are not in writing.

A) "As-is" warranty
B) Express warranty
C) Full warranty
D) Implied warranty
E) Limited warranty

Question 42

Information gathering is part of the ____ phase of the decision-making process.

A) evaluating alternatives
B) postpurchase activities
C) preshopping activities
D) selection and purchase
E) ordering activities

Question 43

These products are sold by one chain of stores and are low-cost alternatives to famous-name products.

A) Private-label brands.
B) Store brands.
C) National brands.
D) Private-label or store brands.
E) All of these are correct.

Question 44

This is a written guarantee from the manufacturer that specifies the conditions under which the product can be returned,replaced,or repaired.

A) Coupons
B) Open dating
C) Rebates
D) Unit pricing
E) Warranty

Question 45

The text identifies several phases in the buying process.The correct order of the phases is

A) Evaluating alternatives, preshopping activities, selection and purchase, postpurchase activities.
B) Preshopping activities, selection and purchase, evaluating alternatives, postpurchase activities.
C) Preshopping activities, evaluating alternatives, selection and purchase, postpurchase activities.
D) Postpurchase activities, evaluating alternatives, preshopping activities, selection and purchase.
E) Evaluating alternatives, selection and purchase, preshopping activities, postpurchase activities.

Question 46

Which of the following is NOT a strategy for wise buying?

A) Buying winter clothes on sale in mid- or late winter
B) Researching the prices and choices for purchases
C) Buying items on impulse
D) Carefully considering buying alternatives
E) Using unit pricing to compare products

Question 47

A service contract

A) Is better than an extended warranty.
B) Is an agreement to cover repair during the implied warranty period.
C) Is included automatically with the purchase of a vehicle.
D) Usually does not cover the engine cooling system.
E) Covers the repair costs of a product.

Question 48

Most products come with some guarantee of quality.This type of warranty covers only certain aspects of the product,such as parts.

A) "As-is" warranty
B) Express warranty
C) Full warranty
D) Implied warranty
E) Limited warranty

Question 49

Most products come with some guarantee of quality.This type of warranty states that a defective product can be fixed or replaced during a reasonable amount of time.

A) "As-is" warranty
B) Express warranty
C) Full warranty
D) Implied warranty
E) Limited warranty

Question 50

Problem identification is part of the ____ phase of the decision-making process.

A) evaluating alternatives
B) postpurchase activities
C) preshopping activities
D) selection and purchase
E) More than one of these is correct.

Question 51

These products are highly advertised and available at many stores.

A) Private-label brands
B) Store brands
C) National brands
D) Regional brands
E) Generic items

Question 52

Mike bought a new car.His new car warranty probably included all of the following except

A) Coverage of basic parts against defects.
B) Corrosion warranty.
C) Extended coverage for air conditioning.
D) Possibility to transfer the warranty to other owners of the car (additional charges may apply).
E) Power train coverage.

Question 53

Partial refunds of the price of a product are called

A) Coupons
B) Open dating
C) Rebates
D) Unit pricing
E) Warranty

Question 54

This type of promotion provides an immediate savings for consumers.

A) Coupons
B) Open dating
C) Rebates
D) Unit pricing
E) Warranty

Question 55

Most products come with some guarantee of quality.Which of the following is usually in written form,created by the seller or manufacturer,and has two forms?

A) "As-is" warranty
B) Express warranty
C) Full warranty
D) Implied warranty
E) Limited warranty

Question 56

Karen bought a mixer.She received a warranty that covers only certain aspects of the product.If the product fails,she may be required to pay part of the costs for shipping or repairs.Which of the following warranties does she have?

A) "As-is" warranty
B) Express warranty
C) Full warranty
D) Implied warranty
E) Limited warranty

Question 57

Frank bought some miniblinds.Although he did not receive a written warranty,the blinds should be expected to open and close properly.What kind of warranty does Frank have?

A) "As-is" warranty
B) Express warranty
C) Full warranty
D) Implied warranty
E) Limited warranty

Question 58

This shopping label is used primarily on perishable products.

A) Coupons
B) Open dating
C) Rebates
D) Unit pricing
E) Warranty

Question 59

A standard measurement used to compare packages of different sizes is

A) Coupons.
B) Open dating.
C) Rebates.
D) Unit pricing.
E) Warranty.

Question 60

Steve bought a laptop that was defective.This laptop will be fixed or replaced by the manufacturer as long as he returns it in a reasonable amount of time.What type of warranty does he have on his laptop?

A) "As-is" warranty
B) Express warranty
C) Full warranty
D) Implied warranty
E) Limited warranty

Question 61

Choosing the payment method is part of the ____ phase of the decision-making process.

A) evaluating alternatives
B) postpurchase activities
C) preshopping activities
D) selection and purchase
E) More than one of these is correct.

Question 62

Resolving purchase concerns is part of the ____ phase of the decision-making process.

A) evaluating alternatives
B) postpurchase activities
C) preshopping activities
D) selection and purchase
E) ordering activities

Question 63

Negotiation activities are part of the ____ phase of the decision-making process.

A) evaluating alternatives
B) postpurchase activities
C) preshopping activities
D) selection and purchase
E) More than one of these is correct.

Question 64

Comparison shopping will be beneficial for buying all of the following except

A) A hot dog at the baseball park.
B) Milk and bread that you buy weekly.
C) A pet dog.
D) Musical instrument accessories that you purchase online.
E) An expensive television.

Question 65

Price analysis is part of the ____ phase of the decision-making process.

A) evaluating alternatives
B) postpurchase activities
C) preshopping activities
D) selection and purchase
E) ordering activities

Question 66

Properly maintaining and operating the product is part of the ____ phase of the decision-making process.

A) evaluating alternatives
B) postpurchase activities
C) preshopping activities
D) selection and purchase
E) More than one of these is correct.

Question 67

When purchasing a used vehicle,it is a good idea to

A) Take out a loan for the entire cost.
B) Accept the dealer at his word about the condition of the vehicle.
C) Have a trained and trusted mechanic of your choice check out the vehicle.
D) All of these are correct.
E) None of these is correct.

Question 68

Comparison shopping will be beneficial for buying

A) Inexpensive items.
B) One-time purchases of low-cost products.
C) Products whose prices are the same at all retailers.
D) Products whose quality is the same at all retailers.
E) Items that can be researched easily with advertisements.

Question 69

A no-haggling dealer will use a(n)

A) Invoice price.
B) Sticker price.
C) Set price.
D) Capitalized cost.
E) Residual value.

Question 70

All of the following are appropriate questions you could ask before making a major purchase except

A) Is it possible to delay the purchase or to do without the item?
B) Should I pay for the item with cash or buy it on credit?
C) Which brands should I consider?
D) How do the price, quality, and service compare at different stores?
E) All of these are questions that should be asked.

Question 71

Buying a vehicle can be a challenging process.When researching a vehicle,a consumer may want to consider all of the following except

A) Mechanical devices to improve performance.
B) Convenience options such as air conditioning.
C) Aesthetic features like metallic paint.
D) All of these may be considered.
E) None of the items listed are important when buying a vehicle.

Question 72

Which of the following is a disadvantage of a car lease?

A) A large down payment is required.
B) At the end of the lease, you have no ownership interest in the vehicle.
C) The capitalized cost is usually lower than the list price.
D) Monthly lease payments are usually lower than monthly financing payments.
E) You can usually obtain a more expensive vehicle than with an outright purchase.

Question 73

The dealer's cost is also known as the

A) Invoice price.
B) Sticker price.
C) Set price.
D) Capitalized cost.
E) Residual value.

Question 74

Which of the following is an advantage of a car lease?

A) A large down payment is required.
B) At the end of the lease, you have no ownership interest in the vehicle.
C) The capitalized cost is usually higher than the list price.
D) Monthly lease payments are usually lower than monthly financing payments.
E) The total cost of a lease may be higher than a purchase.

Question 75

Which of the following sources would be the LEAST helpful when purchasing a vehicle?

A) Personal contacts to learn about product performance.
B) Media information with purchasing advice.
C) Independent testing organizations like Consumers Union.
D) Online sources with product information.
E) Your cousin who has never purchased a car.

Question 76

The amount printed on a label with the suggested retail price that is posted on a vehicle is called the

A) Invoice price.
B) Sticker price.
C) Set price.
D) Capitalized cost.
E) Residual value.

Question 77

The average used car costs about _______ less than the average new car.

A) $0
B) $1,000
C) $10,000
D) $25,000
E) $50,000

Question 78

The price of a leased vehicle is known as the

A) Invoice price.
B) Sticker price.
C) Set price.
D) Capitalized cost.
E) Residual value.

Question 79

Comparison of product features is part of the ____ phase of the decision-making process.

A) evaluating alternatives
B) postpurchase activities
C) preshopping activities
D) selection and purchase
E) ordering activities

Question 80

Which of the following is the best way to state a problem?

A) I need to have a car.
B) I need transportation.
C) I need a motorcycle.
D) I need to have a minivan.
E) I need to have an SUV.