Car Ownership Costs Quiz

Which of the following is considered a fixed cost of owning a car?

• Gasoline

• Insurance

• Oil and other fluids

• Parking and tolls

Which of the following is a variable cost associated with operating a car?

• Interest on loan

• Registration fee

• Maintenance and repairs

• License

According to the 20-10 rule, what is the maximum amount of debt you should have if your annual net income is $24,000?

• $4,800

• $2,400

• $12,000

• $7,200

What percentage of your monthly net income should your total monthly debt payments not exceed according to the 20-10 rule?

• 20%

• 10%

• 15%

• 5%

Variables included when shopping for a car loan are _____.

If the APR is increased from 10.00% to 12.25%, how much more would a borrower have to repay for a $8,000 loan over 36 months? (a)  

• $307.21
• $445.19
• $410.93
• $1,000.00

You estimate the total cost of a loan by (a)   .

• Amount of the loan + APR
• Amount of the loan x APR x number o
• Amount of the loan / APR x number o
• Amount of the loan x APR / number o

What does the Truth-in-Lending Act require lenders to inform borrowers of?

• The borrower's credit score

• The lender's financial status

• The total amount of payments

• The lender's annual revenue

Under the Truth-in-Lending Act, what type of charge must lenders disclose to borrowers?

• Membership charges

• Total finance charge, in dollars

• Optional service charges

• Charitable donation amounts

What is a down payment?

• A monthly payment to reduce the loan balance.

• The final payment to pay off the loan.

• The portion of the home's price paid upfront.

• A refundable security deposit to the bank.