BUSI 223 Quiz 4 solutions complete answers

BUSI 223 Quiz 4 solutions complete answers 

 

Experts suggest that you spend no more than ____________ percent of your net income (after-tax) on consumer credit payments.

 

If you want to improve your credit score, then you should:

 

A debit card:

 

The debt-to-equity ratio is:

 

Which one of the following agencies maintains data about the amount and terms of your credit and your paying habits?

 

Which of the following is the largest fixed expense associated with a new automobile?

 

A disadvantage of leasing an automobile would be the:

 

Emily is trying to decide whether to lease or buy a car. Which one of the following is not a factor necessary in making the comparison?

 

Brad Hayden has a piece of paper that guarantees the conditions, under which he can return, replace, or repair an item that he has purchased. What is it he most likely has?

 

____________ is considered a variable operating cost of an automobile.

 

Which one of the following is an advantage of buying?

 

Which of the following expenses is paid from an escrow account?

 

The amount of mortgage a person is eligible for will be larger when:

 

A major expense associated with home ownership would be:

 

Which of the following is not an advantage of renting?

 

Robert Smith has monthly net income of $1,200. He has a house payment of $550 per month, a car loan with payments of $250 per month, a Visa card with payments of $40 per month, and a credit card with a local department store with payments of $58 per month. What is Robert’s debt payments-to-income ratio?

 

A home worth $160,000 with $80,000 still owed on the mortgage would have equity of $80,000, which is ____ percent of the home’s value.

 

What is the affordable monthly mortgage payment if your yearly gross income is $48,000 and monthly payments on an auto loan are $320?

 

Karen Price has determined that her net worth is $24,000, excluding her home. She owes $90,000 on her mortgage and $12,000 on a car loan. What is Karen’s debt-to-equity ratio?

 

A home worth $250,000 with $100,000 still owed on the mortgage would have equity of:

 

If you sell your home without a real estate agent, you should still employ the services of a(n) _____ to assist you with the contract and the closing.

 

A __________ is a building that contains exactly two housing units.

 

The main housing costs associated with renting are:

 

Credit is an arrangement to receive cash, goods, or services now and pay for them in the future.

 

Consumer credit refers to the use of credit for personal needs by individuals and families.

 

Consumer credit is based on trust in people’s ability and willingness to pay bills when due.

 

Consumer credit dates back to colonial times.

 

Most economists do not recognize consumer credit as a major force in the American economy.

 

“Shopaholics” and young adults are most vulnerable to misusing credit.

 

College students are not a prime target for credit card issuers.

 

Credit, when effectively used, can help you have more and enjoy more.

 

It is safer to use credit, since charge accounts and credit cards let you shop and travel without carrying a large amount of cash.

 

Perhaps the greatest disadvantage of using credit is the temptation to overspend.

 

Although credit allows more immediate satisfaction of needs and desires, it does not increase total purchasing power.

 

With open-end credit, you pay back one-time loans in a specified period of time in payments of equal amounts.

 

With closed-end credit, loans are made on a continuous basis and you make at least a partial payment each billing period.

 

Closed-end credit is used for a specific purpose and involves a specified amount.

 

With closed-end credit, generally the seller holds the title to the merchandise until the payments have been completed.

 

Installment sales credit is a loan that allows you to receive high-priced items, such as large appliances or furniture.

 

Installment cash credit is a direct loan of money for personal purposes, home improvements, or vacation expenses.

 

Single lump-sum credit is a loan that must be repaid in total on a specified day, usually within 30 to 90 days.

 

Using a credit card, such as Visa or MasterCard, is an example of closed-end credit.

 

Interest is a periodic charge for the use of credit.

 

The credit cardholders who pay off their balances in full each month are known as convenience users.

 

Debit cards are often called bank cards, ATM cards, cash cards, and check cards.

 

If your debit card is lost or stolen, you must work directly with the issuer.

 

To protect yourself against credit card fraud, you should sign your new credit cards as soon as they arrive.

 

Department stores and gasoline companies are good places to obtain your first credit card.

 

A home equity loan is usually set up as a revolving line of credit, typically with a fixed interest rate.

 

With a revolving line of credit, borrowings are permitted up to a specified limit and for a stated period, usually 5 to 10 years.

 

The debt payments-to-income ratio is calculated by dividing your total liabilities by your net worth.

 

The debt-to-equity ratio is calculated by dividing your monthly debt payments by your net worth.

 

The smaller the debt-to-equity ratio, the riskier the situation is for lenders and borrowers.

 

The larger the debt-to-equity ratio, the riskier the situation is for lenders and borrowers.

 

When you cosign a loan, you are being asked to guarantee this debt.

 

A lender requires a cosigner even when a borrower meets the lender’s criteria for making a loan.

 

If you cosign a loan, the creditor can collect this debt from you without first trying to collect from the borrower.

 

If you cosign a loan and the debt is not paid off, then this fact does not become a part of your credit record.

 

The Consumer Financial Protection Bureau receives more consumer complaints about credit bureaus than about any other industry.

 

The accuracy of credit reports has worsened recently.

 

The Fair Credit Reporting Act, which regulates the use of credit reports, requires the deletion of obsolete information, and gives consumers access to their files.

 

Credit bureaus obtain their data from banks, finance companies, merchants, credit card companies, other creditors, and court records.

 

Your friends and neighbors can get credit information about you.

 

Most of the information in your credit file may be reported for only seven years. However, if you have declared personal bankruptcy, then this fact may be reported for 10 years.

 

The Equal Credit Opportunity Act is very specific about how a person’s age may be used in credit decisions.

 

In the 5 Cs of credit, capacity refers to the borrower’s attitude toward his or her credit obligations.

 

In the 5 Cs of credit, character refers to the borrower’s attitude toward his or her credit obligations.

 

In the 5 Cs of credit, capacity refers to the borrower’s financial ability to meet credit obligations.

 

In the 5 Cs of credit, capital refers to your assets or net worth.

 

In the 5 Cs of credit, capital refers to your financial ability to meet credit obligations.

 

In the 5 Cs of credit, collateral is an asset that you pledge to a financial institution to obtain a loan.

 

In the 5 Cs of credit, conditions refers to general economic conditions that can affect your ability to repay a loan.

 

A creditor may ignore your retirement income in rating your application.

 

You may not be denied credit because you receive Social Security or public assistance.

 

The Fair Credit Billing Act sets the procedures for promptly correcting billing errors.

 

The Fair Credit Billing Act has a provision in which a lender can threaten your credit rating while you are resolving a billing dispute.

 

When imposters take your name, they are committing a crime.

 

If someone has stolen your identity, the Federal Trade Commission recommends that you contact the fraud departments of each of the three major credit bureaus.

 

A home equity loan is based on the difference between the current market value of your home and the amount you still owe on your mortgage.

 

Consumer credit:

 

When did installment credit explode on the American scene?

 

The baby boom generation currently represents about 30 percent of the population but holds nearly ____________ percent of the outstanding debt.

 

One common type of closed-end credit is:

 

One example of closed-end credit is:

 

Mortgage loans, automobile loans, and installment loans for purchasing furniture or appliances are examples of:

 

Many banks extend a bank line of credit, which is also called:

 

The maximum dollar amount of credit the lender has made available to you is called:

 

An example of open-end credit is:

 

Installment sales credit is a:

 

Which of the following is a prearranged loan for a specified amount that you can use by writing a special check?

 

Installment cash credit is a:

 

A credit arrangement that has no extra costs and no specific repayment plan is called:

 

Revolving check credit is a:

 

A debit card:

 

In determining your credit capacity, you first provide for basic necessities within your budget, such as:

 

Experts suggest that you spend no more than ____________ percent of your net income (after-tax) on consumer credit payments.

 

Today, Michael purchased a laptop computer from a retail outlet. He has agreed to pay for this purchase in full 30 days from today. This is an example of:

 

If you cosign a loan:

 

Which one of the following agencies maintains data about the amount and terms of your credit and your paying habits?

Credit bureau

 

If your monthly net income is $1,500, what should be your maximum amount spent on credit payments?

 

What would be the maximum limit for an individual’s debt-to-equity ratio, excluding the home mortgage?

 

What can be included in your credit bureau file?

 

Which federal law regulates the use of credit reports, requires the deletion of obsolete information, and gives consumers access to their file?

 

Most of the information in your credit file may be reported for only ______ years.

 

If you dispute the accuracy of information in your credit file:

 

An unauthorized person who obtains a credit report under false pretenses may be:

 

The debt payments-to-income ratio is:

 

The debt-to-equity ratio is:

 

Dave’s net take-home pay per month is $2,200. What is the maximum dollar amount of debt payments, excluding a home mortgage, he should have?

 

Which one of the following is not a source that provides data to credit bureaus?

 

If you have declared personal bankruptcy, then this fact may be reported by credit bureaus for ____________ years.

 

If you have incorrect information in your credit file:

 

If you are denied credit, your first step should be to:

 

Which federal consumer credit law starts all credit applicants off on the same footing with factors that may not be used to discriminate against you?

 

If you are a woman, a creditor must:

 

The credit bureau cannot charge you a fee for a copy of your credit report if you request it within ______ days of being notified of a denial based on a credit report.

 

The borrower’s attitude toward his or her credit obligations is called:

 

A bank that is looking at your past payment records on your loans is most likely examining which aspect of the 5 Cs of lending?

 

The borrower’s financial ability to meet credit obligations is called:

 

A term that refers to the borrower’s assets or net worth is called:

 

A valuable asset pledged to obtain a loan and subject to seizure upon default to satisfy the debt is called:

 

A loan officer is examining your income and the amount of your existing debt payments in deciding whether to make a loan to you today. Which aspect of the 5 Cs of lending is the loan officer most likely looking at?

 

In evaluating your credit application, a lender may:

 

If your credit application is denied, you:

 

If you have a problem with your credit account, the best solution is to:

 

Which federal credit law sets the procedure for promptly correcting billing mistakes?

 

The best way to maintain your credit rating is to:

 

If you think that your bill is wrong, you should first:

 

Which federal credit law protects you against an unauthorized use of your credit card?

 

When you complain about your billing error, the creditor must acknowledge your letter within ____________ days.

 

When resolving a billing dispute, a creditor must either tell you why the bill is correct or:

 

What should you do if your identity is stolen?

 

If you have a complaint about consumer credit, you should first:

 

Which federal consumer credit law places the burden of proof for accurate credit information on the credit reporting agency rather than on the consumer?

 

Which federal consumer credit law provides specific cost disclosure requirements for the annual percentage rate and the finance charges as a dollar amount?

 

Which federal consumer credit law prohibits credit discrimination based on sex and marital status?

 

Which federal consumer credit law regulates the advertising of credit terms?

 

If you have a complaint about a bank in connection with any of the federal credit laws, who should you contact?

 

Which federal consumer credit law prohibits creditors from requiring women to reapply for credit upon a change in marital status?

 

Which federal consumer credit law prohibits abusive, deceptive, and unfair practices by debt collectors?

 

Which federal consumer credit law prohibits credit card issuers from sending unrequested cards?

 

Which federal consumer credit law limits a cardholder’s liability for unauthorized use of a card to $50?

 

Which federal consumer credit law requires credit-reporting agencies to send the consumer’s version of a disputed item to certain businesses or creditors?

 

Which federal consumer credit law allows consumers to withhold payment for faulty or defective goods or services when purchased with a credit card?

 

Which federal consumer credit law requires creditors to inform applicants of acceptance or rejection of their credit application within 30 days of receiving a completed application?

 

Which of the following is most likely not a valid reason for using credit?

 

Which one of the following is an advantage of using credit?

 

Which one of the following is a disadvantage of using credit?

 

Jake Skinner purchases a big screen TV on credit and will repay the loan with one payment at the end of 90 days. What type of credit did Jake use?

 

Jennifer Garner purchases a sofa, love seat and reclining chair for her family room and will make payments of $65 per month for the next twenty-four months. What type of credit did Jennifer use?

 

Larry Arnold gets a direct loan of money to go on vacation with his family. He will repay the loan over the next twelve months. What type of credit did Larry use?

 

Gordon Carey uses his Visa card to purchase a new digital camera and lens. What type of credit did Gordon use?

 

Jim Roy visits the doctor for his annual check-up which costs $85. He is billed for this at the end of the month. What type of credit did Jim use?

 

Which one of the following is important to do to help avoid credit card fraud?

 

What should you do when you shop online using your credit card?

 

Robert Smith has monthly net income of $1,050. He has a house payment of $450 per month, a car loan with payments of $250 per month, a Visa card with payments of $50 per month, and a credit card with a local department store with payments of $100 per month. What is Robert’s debt payments-toincome ratio?

 

Karen Price has determined that her net worth is $30,000, excluding her home. She owes $80,000 on her mortgage and $15,000 on a car loan. What is Karen’s debt-to-equity ratio?

 

Karen Price is 55 years old, divorced, and has worked at her current job for five years. She is interested in looking at her credit report. Which of the following pieces of information should she find in this report?

 

Maryann Lawrence wants to get a loan in just her name. She knows the creditor cannot:

 

Jennifer Rogers needs a loan to purchase a new car. She knows the creditor must:

 

The information in your credit report is primarily used by the credit bureau to calculate your:

 

Which of the following is a credit bureau?

 

Paul Carter is applying for a loan from a bank. The bank is concerned because Paul is an airline pilot for United Airlines. The bank thinks that Paul may be laid off in the near future. Which one of the 5 Cs of credit is the bank concerned with?

 

Jane Calvert is applying for a loan from a bank. The bank knows she owns a house worth $150,000 and a car with a trade-in value of $15,000 as well as other personal assets worth approximately $50,000. Which one of the 5 Cs of credit is the bank looking at?

 

Charles Rickman is applying for a loan from the bank. The bank has determined that he has never been late making payments on past loans. Which of the 5 Cs of credit is the bank looking at?

 

Amy Farmer is getting a loan to buy a used car. The bank wants to know the trade-in value of the car she is purchasing. Which of the 5 Cs of credit is the bank examining?

 

Michael Flowers believes that his credit card company has made an error in its monthly statement to him. Which consumer protection law specifies procedures he can use to dispute this monthly statement?

 

Paul Phillips has checked his credit report and believes there is an error in it. Which consumer protection law specifies that he has the right to have errors in his credit report investigated?

 

Samantha Prescott knows that credit companies must evaluate her on the same basis as a borrower who is male. Which consumer protection law guarantees her this right?

 

Mike Cook has been receiving calls at work every two hours from a collection company that is trying to collect a past due loan from him. He believes this is harassment and that the collections company is not allowed to do this. Which consumer protection law provides protection from this type of harassment?

 

Lester McCann is thinking about getting a loan for a new car. He knows that when he goes shopping for a loan that all of the banks must report the annual percentage rate as well as all other terms and conditions of the loan. This will allow him to easily compare loans from different banks. Which consumer protection law requires full disclosure on all loans?

 

Which one of the following would not be considered closed-end credit?

 

Co-branded credit cards:

 

Which one of the following would not be a good use of a home equity loan?

 

If you want to improve your credit score, then you should:

 

Brian Porter’s net worth is $110,000, excluding his home. His liabilities of $50,000 include all of his credit card balances and the balance due on his auto loan and home improvement loan. His townhouse has a market value of $220,000 and he owes $190,000 to his mortgage company. What is Brian’s debt-toequity ratio?

 

Stored-value cards:

 

Which FICO credit score would represent the least risky borrower?

 

According to a recent survey, what percent of U.S. households carry one or more credit cards?

 

If you think you have been discriminated against by consumer reporting agencies or creditors, you should file a complaint with which government agency?

 

Approximately how many credit card users would be classified as “convenience users” who generally pay off their balances in full each month?

 

Debit cards are often called:

 

In addition to department stores, where else is a good place to obtain your first credit card?

 

Which one of the following is not included in the 5 C’s of credit?

 

Credit bureaus obtain data from which of the following?

 

Which of the following federal consumer credit laws requires creditors to promptly credit customers’ accounts and to return overpayments if requested?

 

The Consumer Financial Protection Bureau receives an average of how many complaints about the credit bureaus every year?

 

Which of the following places new restrictions on credit card lending and eliminates certain fees?

 

According to the Credit CARD Act, your credit card company must send you a notice ___days before they can increase your interest rate.

 

Which federal consumer credit law places the maximum cost of a credit report at $8?

 

Which federal consumer credit law requires “credit repair” companies to give consumers a written contract that can be canceled within three business days?

 

Which federal consumer credit law requires issuers to display on monthly statements how long it would take to pay off the existing balance and the total interest cost if the consumer paid only the minimum due?

 

How many alternatives do most consumers have in financing current purchases?

 

Which of the following is true of the baby boom generation?

 

Which of the following is not a valid reason for using credit?

 

Which of the following are most vulnerable to misusing credit?

 

Elizabeth has a monthly net income of $1,600. She has a house payment of $600 per month, a car loan with payments of $400 per month, a Visa card with payments of $75 per month, and a credit card with a local department store with payments of $125 per month. What is Elizabeth’s debt payment-toincome ratio? Is she within range of what experts suggest you spend on consumer credit payments?

 

The first phase in the buying process involves information gathering.

 

Advertising is a type of consumer information commonly provided by business organizations.

 

Government agencies provide information sources and complaint hotlines to assist consumers with buying decisions.

 

The most consistent quality is usually found with nationally known, brand-name products.

 

Open dating information provides consumers with information about the freshness of a perishable product.

 

Service contracts are usually free and included in the cost of appliances and other high-priced items.

 

Mediation involves a legally binding decision by a third party to solve a consumer complaint.

 

Representation by a lawyer is usually required in small claims court.

 

A class-action suit allows a legal action to be taken by a few individuals on behalf of all the people who have suffered the same alleged injustice.

 

Unit pricing uses a standard unit of measurement to compare the prices of packages of different sizes.

 

A limited warranty covers all aspects of the product and does not require the buyer to incur any of the costs for shipping and repairs.

 

One way to gather information about a product is to use an independent testing organization like Consumers Union.

 

Near-field communications allows consumers to make purchases by waving their smartphones in front of a sensor when paying.

 

An example of an economic factor that influences buying decisions would be:

 

Which one of the following is the best example of a personal opportunity cost associated with a consumer purchase?

 

The first phase of the consumer buying process involves:

 

The most reliable source of product information is likely to come from:

 

Which organization specializes in the testing of products for electrical and fire safety?

 

The main purpose of Consumers Union is to:

 

A cooperative is designed to:

 

____________ are non-profit stores organized by people in a neighborhood to serve their customers, who are also called members. Prices at this type of store are usually lower than at other retailers.

 

Cooperatives are commonly organized to sell:

 

Impulse buying refers to:

 

The items produced for a single chain of stores are commonly sold under a ____________ brand.

 

Which of the following information is required on food labels?

 

Private label products are those that:

 

Open dating provides information on:

 

A 32-ounce package selling for $1.60 would have a unit price of:

 

Which one of the following is not a common consumer myth?

 

What type of warranty indicates that the seller has the right to sell a product?

 

Howard Ramsell recently became aware of implied warranties that exist for consumer purchases. An implied warranty exists as a result of:

 

Which one of these statements best describes a criticism of service contracts?

 

The purpose of a service contract is to:

 

Most consumer complaints are resolved by:

 

Pam McNally is planning to use the services of the Better Business Bureau. A major purpose of the BBB is to help:

 

The process of resolving conflicts between a customer and a business with the use of a third party whose recommendations are non-binding is called:

 

____________ is the settlement of a difference by a third party whose decision is legally binding.

 

Arbitration differs from mediation in that arbitration:

 

The purpose of small claims court is to:

 

Small claims courts:

 

Recently, Jim Dahl was on a bus tour in a mountainous area. The bus broke down forcing the group to stay overnight. Group members had to pay for their own hotel bills. Jim believes that the hotel cost for the group should be paid by the tour company. Which legal action would be most appropriate?

 

For a situation to qualify as a class-action suit, it must:

 

Which of the following statements about a legal aid society is not true?

 

When buying an automobile, the best warranties are usually offered by a:

 

Federal Trade Commission regulations require that:

 

An implied warranty that comes with a used car is that:

 

A used car sold “as is” has:

 

Most used cars bought from private parties have:

 

The main purpose of the Edmund’s Used Car Prices is to:

 

The sticker price of a car refers to:

 

The purpose of the invoice price is to inform customers of the:

 

The purpose of an automobile service contract is to:

 

A disadvantage of leasing an automobile would be the:

 

Mike Jacobs is planning to lease an automobile. In an effort to minimize the price of the vehicle being leased, Mike should compare the ____________ at different leasing companies.

 

Which of the following is usually the largest fixed expense for a new vehicle?

 

____________ is considered a variable operating cost of an automobile.

 

Greg Rossman likes to play golf. This would be an example of a _________ factor that influences his purchasing decision.

 

Paul Spoon has noticed that interest rates have risen in recent months. He is worried that this may make it more difficult for him to finance the purchase of a car. This would be an example of a ________ factor that influences his purchasing decision.

 

The Sears Kenmore dishwasher is an example of a:

 

A Whirlpool dishwasher is an example of a:

 

Margaret Wilson has a piece of paper that she can mail in to the manufacturer of the product that she just purchased. It allows her to get part of her purchase price back. What is she most likely using?

 

Brian Williams has a piece of paper that he gives to the cashier when he purchases a particular item that allows him to get a dollar off the cost of that item. What is he most likely using?

 

Brad Hayden has a piece of paper that guarantees the conditions, under which he can return, replace, or repair an item that he has purchased. What is it he most likely has?

 

Stephanie Johns is a member in a store that is a nonprofit organization that buys grocery items in bulk. Members can save a considerable amount on the groceries they purchase in the store. Stephanie is most likely shopping in which type of store?

 

Gina Raffetto’s car broke down on the way to work, and her mechanic has told her that the car cannot be fixed. Gina drives 30 miles one way to work each day. There is no reliable bus or train transportation that goes anywhere near her work. Gina decides she needs a car for reliable transportation to work. What step in the purchasing process is Gina carrying out?

 

Hector Ramirez has decided he needs a new car so that he has reliable transportation to work. He is getting recommendations from his friends as to what might be a good car to purchase. He is also looking at the Consumer Reports magazine to determine what they recommend as a safe, low maintenance car, and he has searched some web sites on the internet as well. What step in the purchasing process is Hector carrying out?

 

Sally Nash has decided she needs a new car. After doing some research, she has settled on a midsized four door sedan. She likes the Honda Accord and is exploring the features she needs and wants on this car. She is also trying to decide whether she would be better off purchasing a new car, a used car, or leasing a car. She knows that if she purchases it new it would likely last her for many, many years. On the other hand a used car would be a lot cheaper. She is not sure a lease is for her because of the mileage requirements. What step in the purchasing process is Sally carrying out?

 

Lorenzo Clowder has settled on purchasing a new Honda Accord and has found that the suggested retail price is $22,200 and that the dealer’s invoice price is $19,980. It is time for him to go to a dealer and negotiate the price he will pay for his new car. What step in the purchasing process is Lorenzo carrying out?

 

Damian Walker just purchased a new vehicle. He is reading his owner’s manual to know when he needs to take it in for its regular servicing at the dealer. He wants to make sure this car lasts a while. What step in the purchasing process is Damian carrying out?

 

Which of the following would be an advantage of leasing a vehicle?

 

The price that is paid for a vehicle in a lease is called the:

 

Tiffany Parrish has purchased a new car. Since then she has had to make six trips to the dealer in four weeks to fix several major problems without much luck. She knows that she is entitled to a refund. What type of law gives her the right to ask for a refund?

 

An online buying club requires an annual fee of $60 in order to qualify for a 15 percent discount on purchases. What amount would a person have to buy in order to save enough to cover the cost of the membership?

 

A credit purchase with 24 monthly payments of $78 and a down payment of $120 would have a total cost of:

 

Isabel would spend $200 per week on groceries for her family if she did not use coupons. Her coupons save her 10 percent of that amount. She puts the amount saved into her savings account. How much will she have in her savings account at the end of the first year? Ignore interest earnings.

 

A motor vehicle has annual depreciation of $2,000; oil changes cost $120, automobile insurance $500 annually, and license plates costs $100. What is the annual amount of the total fixed operating cost for this vehicle?

 

Emily is trying to decide whether to lease or buy a car. Which one of the following is not a factor necessary in making the comparison?

 

Regular vehicle maintenance is essential to extending the life of your car. Engine oil should be changed approximately every _______ miles, depending on recommendations for the vehicle.

 

This scam uses e-mail spam or pop-up messages to deceive you into revealing your credit card number, bank account information, social security number, passwords, or other personal information is called:

 

Which of the following is least likely to assist you in timing purchases to help you obtain bargains?

 

Sloane owes $2,600 on her car loan. According to Edmond’s Used Car Prices, her car is valued at $1,950. The term used to refer to this situation is:

 

The expected value of a vehicle at the end of a lease is called the:

 

A scam that involves malicious software or an e-mail attachment that places a virus or worm in the user’s computer or in a server that directs traffic on the Internet is called:

 

Federal laws limit the amount that a consumer is liable for regarding purchases made with a lost or stolen card to:

 

Which of the following is not a social factor that would influence a consumer buyer’s decision?

 

What type of warranty covers only certain aspects of the product, such as parts, or requires the buyer to incur part of the costs for shipping or repairs?

 

Consumer information from websites is commonly provided by:

 

Which type of purchasing strategy involves comparing unit prices?

 

Which type of government agency provides educational programs to assist consumers with buying decisions?

 

Consistent quality is usually found with national-brand products, excluding:

 

Which of the following is usually not in written form?

 

Which of the following is a social factor that would influence a consumer’s buying decision?

 

In most states, creditors are not permitted to call you:

 

To save money and help improve the environment, 20SomethingFinance.com suggests that you:

 

An example of a financial services cooperative is a:

 

Which of the following is a store-brand product?

 

An example of Open dating that appears on grocery items is:

 

An implied warranty of merchantability guarantees that:

 

A lease provides protection to both the tenant and the landlord.

 

Condominiums involve the purchase of an individual housing unit in a building rather than an entire building.

 

Real estate professionals believe that location is the most important factor to consider when selecting a home.

 

Negotiating a purchase price for a home can involve an offer and a counteroffer.

 

The amount of the down payment will affect the size of the mortgage loan needed to purchase a home.

 

Prepaid interest may be a part of a mortgage agreement.

 

Amortization refers to changes in the monthly payment for a variable rate mortgage.

 

An FHA-insured mortgage has low down payment requirements and is fully assumable with no prepayment penalties.

 

An escrow account is designed to reduce the cost of a mortgage.

 

An appraisal refers to the price for which a home has been sold.

 

Home improvements may or may not increase the selling price of the home.

 

The purpose of a rate cap in an adjustable rate mortgage is to limit the amount by which the interest rate can vary.

 

A deed is the document that transfers ownership of the property from one party to another.

 

Real estate advisors suggest a price-to-rent ratio of 25 or lower when you buy to possibly avoid a lower home value after your purchase.

 

A payment cap keeps the payments on an adjustable-rate mortgage at a given level or limits the amount to which those payments can rise.

 

Renting is more advantageous than buying a home when you are seeking:

 

A common cost associated with renting is:

 

A major expense associated with home ownership would be:

 

Renting would be most appropriate for people who:

 

Kate plans to rent instead of buying her housing. Which advantage of renting will she realize?

 

The legal document involved in renting an apartment is called a:

 

What does it mean to sublet an apartment?

 

The purpose of a security deposit is to:

 

A condominium involves:

 

Multi unit dwellings include:

 

A cooperative housing arrangement involves:

 

Prefabricated homes refers to:

 

Which of these is a potential financial benefit of home ownership?

 

Which of the following would increase the amount that a person could afford to spend on a home?

 

As you determine how much of a home you can afford, consider the price of the house along with the quality and:

 

The purpose of zoning laws is to:

 

Which type of repair problem is more likely to be covered by a new homeowner service contract?

 

The purpose of a counteroffer is to:

 

Earnest money is used:

 

The amount of mortgage a person is eligible for will be larger by:

 

Which of the following would increase the equity in a home at a faster rate?

 

Prepaid interest charged by a mortgage lender is called:

 

Todd Foley is applying for a $100,000 mortgage. He can select either a $600 monthly payment with no points or a $ 520 payment with two points. How many months will it take Todd to cover the cost of the discount points if he takes the lower monthly payment?

 

A conventional mortgage usually involves:

 

Which of the following is an example of a conventional mortgage?

 

A VA-guaranteed loan program provides assistance to:

 

A possible disadvantage of FHA and VA mortgages can be:

 

The purpose of a rate cap with an adjustable rate mortgage is to:

 

Which one of these situations creates negative amortization?

 

A newly married couple is having trouble affording a home. What type of mortgage arrangement would reduce the monthly payment as a result of an interest rate subsidy from a builder or real estate developer?

 

A home equity loan may also be referred to as a ____________ mortgage.

 

Refinancing of a mortgage is recommended when:

 

Which of the following is an example of a closing cost?

 

The purpose of title insurance is to:

 

Which document does the seller use to guarantee the title is good?

 

Which of the following expenses is paid from an escrow account?

 

An appraisal is likely to cost between:

 

If you sell your home without a real estate agent, you should still employ the services of a _____ to assist you with the contract and the closing.

 

One service provided by a real estate agent when selling your home is:

 

Which one of the following is an advantage of renting?

 

Which one of the following is an advantage of buying?

 

A cost associated with renting would be:

 

A _________ is a building that contains exactly two separate homes.

 

Gary Smith is purchasing one housing unit in a building with several units. What type of housing is Gary most likely going to live in?

 

James Monroe is a member of a nonprofit organization that allows him to rent a living unit in a building. What type of housing is James most likely living in?

 

Jennifer Garland is purchasing a home that was assembled in a factory and then moved to the living site. What type of housing is Jennifer purchasing?

 

What is the most popular form of housing?

 

The assessed value of your home is the:

 

The appraised value of your home is the:

 

Michelle Duncan wants to know what price home she can afford. Her annual gross income is $45,000. She owes $750 per month on other debts and expects her property taxes and homeowners insurance to cost $250 per month. She knows she can get a 7.5%, 30 year mortgage so her mortgage payment factor is 6.99. She expects to make a 20% down payment. What is Michelle’s affordable home purchase price? Round your answer to the nearest 

 

Duane Miller wants to know what price home he can afford. His annual gross income is $60,000. He has no other debt expenses and expects property taxes and insurance to cost $400 per month. He knows he can get a 6%, 15 year mortgage so his mortgage payment factor is 8.43. He expects to make a 10% down payment. What is Duane’s affordable home purchase price? Round your answer to the nearest $100.

 

A loan based on the high equity in a home that provides the homeowner with tax-free income and which is paid back when the home is sold is called a:

 

A renter is required to pay a security deposit of $800, on which 4 percent interest will be paid. What amount would the person earn each year?

 

If closing costs of $1,400 are associated with the refinance of a mortgage that would reduce the monthly payment from $980 to $870, it would take approximately ____ months to cover these costs.

 

A contract condition that states that the agreement is binding only if a certain event occurs is a:

 

Paula has completed a mortgage application and provided evidence of employment, income, assets owned, and existing debt to the potential lending institution. Although Paula has not even begun the process of looking at possible homes to buy, she is eagerly awaiting news from the lender as to whether she has been approved for a mortgage. In what stage of the application process is she?

 

Noelle and Larry have decided to perform the landscaping of their new home by themselves. They also plan to take a do-it-yourself class at a local home store so they can replace the tile in the master bathroom without using a contractor. The effect of performing these tasks themselves will result in an increase in their:

 

Which type of home has a tendency to depreciate in value?

 

Brett has hired a professional to assess the soundness of the roof, foundation, and building materials of a potential home he is considering. The professional will also be checking other aspects of the home including the plumbing, heating, and cooling systems. Brett is paying for a:

 

Legislation that requires that loan applicants be given certain information, including an estimate of the closing costs, before the actual closing is known as:

 

During which phase of the home-buying process would you assess types of housing available?

 

The Homeowners Protection Act requires that a PMI policy be terminated automatically when a homeowner’s equity reaches _____ percent of the property value at the time the mortgage was executed.

 

Private Mortgage Insurance is usually required if the down payment is less than _____ percent of the purchase price of the home.

 

What is the term used to describe the reduction of the balance owed on a loan with each payment made over a period of time?

 

Money that is usually deposited with the lending institution for the payment of property taxes and homeowner’s insurance is called:

 

Most people do not select a place of residence based on:

 

A lease is a legal document that provides the right to take legal action by the ____ for nonpayment of rent.

 

Which home improvement is least likely to increase the value of your home?

 

A payment cap on an adjustable-rate mortgage can result in negative amortization when:

 

Which of the following can help you prepare your home for selling?

 

Which procedure is a security measure if you are selling your home without a real estate professional?

 

A real estate short sale occurs when:

 

A home worth $200,000 with $120,000 still owed on the mortgage would have equity of $80,000, which is ____ percent of the home’s value.

 

A home worth $300,000 with $180,000 still owed on the mortgage would have equity of:

 

What is the affordable monthly mortgage payment if your monthly gross income is $60,000 and monthly payments on an auto loan are $400?

 

Which of the following serves as collateral for the mortgage?

 

You believe that interest rates may drop and have decided not to lock in an interest rate on your loan during the loan commitment process. This is called a:

 

Which of the following is most commonly used as a base index for setting rates for adjustable rate mortgages?

 

Selecting a place of residence is reflected by your:

 

Which of the following is not an advantage of renting?

 

Which of the following is a form of housing in which the units in a building are owned by a nonprofit organization?

 

Which of the following can affect the price of a home?