What is Depreciation?

What is the primary reason a vehicle's value drops significantly the first day of ownership?

• Wear and tear

• Accidents

• Incentives

• Mechanical issues

How much do cars on average lose their value as soon as they are driven off the lot?

• 20%

• 15%

• 10%

• 5%

What factor contributes to the depreciation of a car when it is sold or traded in at a dealership?

• Wholesale price

• Retail price

• Original MSRP

• Incentive value

Who won a Nobel Prize for the idea related to why cars lose value so quickly?

• George Akerlof

• Milton Friedman

• Adam Smith

• John Maynard Keynes

What is the typical time for a lease, which is a benchmark for the used car market?

• One year

• Two years

• Three years

• Five years

What was the average transaction price for new vehicles in October 2023?

• $48,126

• $34,077

• $25,000

• $50,000

By what percentage did used car values skyrocket during the Covid-19 pandemic?

• 10%

• 20%

• 30%

• 40%

What was the primary cause of the car market disruption in 2020?

• Decrease in oil prices

• Supply chain and chip shortages

• Increased demand for luxury cars

• Economic recession

What percentage of new cars were financed in the second quarter of 2023?

• 50%

• 60%

• 80%

• 70%

How much higher is the average new car price compared to pre-pandemic times?

• 30%

• 20%

• 40%

• 10%