Personal Finance 6.06-6.07

Melissa needs a vehicle and is considering leasing one. This means:

• she would be purchasing the vehicle by making payments over time

• she would be renting the vehicle by making payments over time, although the vehicle title would remain with the lease grantor

• her depreciation costs will likely be higher

• she will need to pay a larger down payment to offset the lease agreement fees.

Why is investing in product research an important part of the planned buying process?

• research enhances satisfaction

• research decreases satisfaction

• research is too time consuming

• research is only necessary for big purchases

A rental agreement is often referred to as:

• a lease

• an amenity

• renters insurance

• a mortgage

Brett borrowed money to purchase a vehicle without making a down payment and now he owes more on the vehicle than it is worth. This situation is referred to as:

• depreciation

• being upside down on the loan

• leasing

• a hidden cost

In which scenario should renters insurance be considered?

• Steve and Teri have purchased a home in a rural area

• Tim and Hanna are living with his parents in the basement of their home for six months. They are paying his parent rent.

• Zach and Leah have rented an apartment in an urban area

• Don and Denise are landlords for several rental properties

Alyssa is considering purchasing a car and wants to be sure she can afford to drive it during the school year when she does not have a job. Which expense would not be considered part of the total transportation expenses?

• automobile payment

• fuel

• parking

• depreciation

When making food decisions, which is likely to be the least expensive?

• convenience foods

• fast food restaurants

• ready-to-eat foods

• full-service restaurants

Chad has decided to rent an apartment and is gathering information to be sure he has enough money saved for all the expenses when he moves in. His landlord explained to him that he would need to pay a refundable fee to cover any potential damages that might occur while Chad is living in the apartment. The fee is called the:

• rental agreement

• down payment

• amenities

• security deposit

Shelby is working on her spending plan and would like to spend less on her food for 6 months as she saves toward purchasing a more reliable vehicle. As she makes her plan, which factor would be least important to consider?

• How much time she has available to prepare food

• the skills she has acquired for preparing meals

• the nutritional value of the foods she purchases

• her personal preferences

The equity that one builds by making a mortgage payment is:

• the value of the home after the mortgage debt is subtracted

• purchasing a housing unit as rental property

• a home loan where the real estate is collateral

• the amount of money paid on the home at the time of purchase