Finance EXAM 2

Installment credit exploded on the American scene with the advent of the

Automobile

Henry was driving at dusk and hit a deer running across the road. His damage would be covered under his

Collision policy

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

Comparison shopping

Paul and Lora built their home. When they researched contractors, they paid attention to all of the following except

Contractor's property tax payments during construction

Donald and Charlene are married and do not have any children. Each plans to continue to work after the other one dies. Which method are they using to determine their life insurance needs?

Dual income, no kids method

Franklin wants to sell his house himself. Which of the following is NOT correct about his sale.

He should show the house only when he is home alone

Andrew is applying for insurance for his new home. Which of the following is correct?

He should use the replacement value method for settling claims to receive the full cost of repairing or replacing his personal belongings

Barnaby is applying for insurance for his new home. Which of the following is correct?

His policy should automatically increase coverage as construction costs rise.

The type of health insurance coverage that pays for some or all of the daily costs of room and board during a hospital stay is

Hospital expense

If you miss payments on a home equity loan, you can lose your

House

When used effectively, credit can result in

Improved lifestyle

If you do not pay back any of the loan amount for a portion of the loan period, you have a(n)

Interest-only mortgage

This health insurance provision sets limits on the amount of repayment for certain services.

Internal limits

Helga plans to purchase a pickup truck. She should begin her price negotiation at the

Invoice price

This provides the tenant protection from rent increases

Lease

Home equity loans should be used for

Major expenses such as home improvements or education

Another name for a straight term policy is

Multiyear level term

A potential problem with having a long car loan is

Negative Equity

Todd plans to purchase a life insurance policy from a stocky life insurance company. What kind of policy is he planning to purchase?

Nonparticipating policy

A quality health insurance plan should do all of the following except

Provide a lifetime maximum level of coverage of up to $50,000

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

Selection and purchase

The Health Insurance Portability and Accountability Act of 1996

Sets federal standards to ensure that workers do not lose their health insurance if they change jobs

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

Warranty

Another name for permanent life insurance is

Whole life

Katrina was injured in an accident at work. The benefits she will receive to cover part of her income will come from

Worker's compensation

If you have a conversion term policy,

You can convert your term policy to a permanent policy.

If you have a loss due to a flood,

You need to have purchased special coverage if you live in an area that has frequent floods in order to be covered

Acme Home lending offers home equity loans up to 80% of the home value for its customers. If sally johnson has a home valued at $200,000 and a current mortgage of 50,000 how much can she borrow in a home equity loan from Acme

$110,000

Homeowner's insurance covers all of the following except

All of these are covered.