Finance Quiz #6

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

Limited warranty

Tamra went to a restaurant and had an unpleasant experience that sent her to the hospital. The problems at the restaurant should be handled by

The county health department.

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

Warranty

What is the unit price of a 32 ounce box of brown sugar that costs $3.20?

$0.10 per ounce.

Using the following information, what is the cost to lease a car? • Security deposit $300 • Monthly lease payment $300 per month for a five-year lease • Opportunity cost of security deposit 300 × loan period (in years) × 2% interest • End-of-lease charges 500

$18,530

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

At the end of the lease, you have no ownership interest in the vehicle.

Steven needs to write a will. His best resource is (a/an)

Attorney.

Adolph has a low income and cannot afford his own attorney. He needs legal assistance and should make use of (a)

Legal aid society.

The price of a leased vehicle is known as the

Capitalized cost.

Craig wants to get his old car repaired, but he doesn't want to spend much money. He probably will NOT want to go to the most expensive repair service, which is from a(n)

Car dealer.

Sally has a major problem with a product and thinks that many others have had the same problem. Which of the following is the best way to resolve the problem?

Class action lawsuit

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

Comparison shopping.

This type of promotion immediately reduces the amount a family spends on groceries each week.

Coupons

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?

Express warranty

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

Extended coverage for air conditioning.

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.

Full warranty

The appearance of a used car can be deceptive. When purchasing a used vehicle, it is a good idea to

Have a trained and trusted mechanic of your choice check out the vehicle.

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.

Implied warranty

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

Impulse shopping.

The dealer's cost is also known as the

Invoice price.

Which of the following is correct about the lemon law?

It applies to vehicles that have been serviced four times to correct the same problem in the first 12,000 miles.

A variable operating cost for a vehicle is

Maintenance and repairs.

All of the following are fixed operating costs for a vehicle except

Maintenance and repairs.

A process used to settle grievances in a nonbinding process is called a(n)

Mediation.

A vehicle lease has several costs. Which of the following is the interest rate used to calculate the monthly cost?

Money factor.

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

Monthly lease payments are usually lower than monthly financing payments.

These products are highly advertised and available at many stores.

National brands

The lowest payment does not necessarily mean the best credit plan. If your car loan is a long period of time, you may end up owing more than the car is worth, which is called

Negative equity.

This shopping label is used primarily on perishable products to help the consumer judge freshness or shelf life.

Open dating

A vehicle lease has several costs. Which of the following is the amount paid monthly and the number of payments?

Payment schedule

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

Private-label or store brands.

A partial refund of the price of a product is called a

Rebate

George has never bought a new car before. Which of the following techniques should he use to get the best deal?

Research the dealer cost and begin negotiations from that point

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

Residual value.

A no-haggling dealer presents the price of a new car to be accepted or rejected as stated and is called a(n) ________ dealer.

Set price.

If you have a problem whose remedy will be between $1,500 and $3,000, the appropriate tool to use would be (a)

Small claims court.

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

Sticker price.

Using the following information, what is the cost to buy a car? • Down payment $3,000 • Monthly loan payment $350 per month for a six-year loan • Opportunity cost of down payment $3,000 × loan period (in years) × 2% interest • Estimated value of vehicle at end of ownership period $4,000

$24,560.

All of the following are variable operating costs for a vehicle except

Depreciation.

While evaluating alternatives, 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) How do the price, quality, and service compare at different stores? D) Which brands should I consider? E) All of these are questions that should be asked.

E) All of these are questions that should be asked.