Chapter 10

Indicate whether the statement is true or false. 1. The price you pay for a new car is determined by the manufacturer.

• True

• False

Indicate whether the statement is true or false. 2. Most car buyers negotiate with the manufacturer to get the best price.

• True

• False

Indicate whether the statement is true or false. 3. Most cars are financed with an installment loan.

• True

• False

Indicate whether the statement is true or false. 4. Auto loans typically have terms of more than six years.

• True

• False

Indicate whether the statement is true or false. 5. Depreciation can only be avoided by purchasing a car when it is new.

• True

• False

Leasing a car is an alternative to purchasing it.

• True

• False

Liability coverage is required under state law to operate a car.

• True

• False

Collision coverage is typically required by lenders when a car serves as collateral for an auto loan.

• True

• False

The price you pay for a new car is determined by . A. the manufacturer B. state law C. negotiations between you and the manufacturer D. negotiations between you and the dealer

• the manufacturer

• state law
• negotiations between you and the manufacturer

• negotiations between you and the dealer

A car purchase must include . A. a manufacturer’s rebate B. an extended warranty C. tax, title, and license fees D. All of the above.

• a manufacturer’s rebate

• an extended warranty

• tax, title, and license fees

• All of the above