Personal Finance: chapter 8 pt.2

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

"automotive service contracts can cover repairs not included in the manufacturer's warranty"

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

$1,992

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?

$2,600

Which type of government agencies publish materials to assist consumers with buying decisions and financial planning?

all of these

Advertising is a type of consumer information commonly provided by:

business organizations

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

arbitration

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

capitalized cost

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?

cooperative

__________ are non-profit stores created 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

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?

information gathering

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(n) _____ factor that influences his purchasing decision.

economic

The main purpose of Consumers Union is to:

evaluate the quality of products and services

An implied warranty is usually in written form.

false

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

false

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?

lemon law

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?

limited warranty

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

new car dealer

A vehicle sold "as is" has:

no express warranty

Which of the following information is required on food labels?

open dating

A high tech scam that uses spam or pop-up messages to deceive you into revealing your credit card number, bank account information, social security number, passwords, or other sensitive information is called:

phishing

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?

post purchase activities

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

residual value

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

store

The Sears Kenmore dishwasher is an example of a:

store brand

Which one of these statements best describes the major criticism of service contracts?

the contracts are expensive and contain a lot of exclusions

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

the intended use of a product

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

time spent comparing prices

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

true

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

true

Impulse buying refers to:

unplanned purchasing