EPF Unit 2 Part 1 Study Guide - Money Management

What are Jade’s variable expenses?

• Rent and loans

• Groceries and entertainment

• Insurance and savings

• All of the above

What are Jade’s fixed expenses?

• Rent and loans

• Groceries and dining out

• Entertainment and travel

• Clothing and accessories

What areas can Jade make cuts if needed?

• Utilities

• College loans

• Clothing

• Pet care

What expenses above would be a discretionary expense?

• Rent

• Groceries

• Dining out

• Utilities

Which of the following is a pro of buying a home?

• It provides a stable living environment.

• It requires a large down payment.

• It limits mobility.

• It involves maintenance costs.

Which of the following is a pro of renting a home?

• Flexibility to move without selling property

• Building equity over time

• Potential tax benefits

• Ability to renovate freely

The first piece of information needed to make a decision on a mortgage type is:

• Budget

• Down payment amount

• Interest rate

• Loan term

The recommended down payment on a fixed rate mortgage is:

• 5%

• 10%

• 20%

• 25%

The interest rate starts to fluctuate in an adjustable-rate mortgage:

• at the beginning of the loan term

• after a fixed period

• when the borrower defaults

• when the property value changes

What is the APR for a FICO score of 720?

• 5.935%

• 6.157%

• 6.334%

• 6.548%