EPF Module 10 Review

This type of insurance covers damage to your car in case of theft or vandalism

• comprehensive

• collision

• uninsured motorist

• property damage liability

Which of the following is true?

• Add-ons from the dealership like rustproofing are generally not a good idea.

• The price advertised by the dealership for the car includes the tax and title fees

• Car prices cannot be negotiated on the internet.

• The depreciation of new cars is minimal in the first year of ownership

Leasing a car might be a good option for someone who

• always wants to drive a newer car

• drives a lot of miles every year

• wants to own the car at the end of the term

• wants to customize their car

When you lease a car you  have an option to purchase it at a pre-negotiated price at the end of the lease.

• True

• False

Which of the following could be included in the expenses for a renter?

• Security Deposit

• First and last month's rent

• Additional fees

• All of these

Renting would be better than buying for an individual who

• needs to relocate every year for work

• wants to establish equity in the property

• wants to earn a tax benefit from their payments

• wants to knock out a wall to make a larger master bathroom at their place.

A friend says they found a perfect apartment and that the rent is only 50% of their total income. How should you respond? 

• That's way too high of a percentage. Look for housing that's no more than around 30% of your total income.

• That's perfect - the target is right around 50% of your income.

• Choose any apartment you want to rent, the cost of rent as a percent of income doesn't matter at all.

The first step in the PACED decision model is

• define the problem

• make a decision

• evaluate the choices

• list the alternatives

Fixed rate mortgages can come in different term lengths.

• True

• False

If a buyer is unable to pay for the entire purchase price of a home in cash, they must take out a home loan known as a ________________ to cover the rest of the cost of the home.

• mortgage

• bankruptcy

• lien

• point