Terminology Review 7-Buying A Car

What is an Auto Dealership?

• A business that sells new or used cars.

• A place where cars are manufactured.

• A service center for car repairs.

• A financial institution for car loans.

What is an Auto Lease?

• An agreement where an individual makes monthly payments to use a car for a certain length of time instead of purchasing the car.

• A type of insurance policy for vehicles.

• A loan taken to purchase a car.

• A method of car maintenance.

What is a Bumper-to-Bumper Warranty?

• A comprehensive plan that covers most car parts, with a few exceptions, for a limited period of time.

• A warranty that only covers the car's tires and wheels.

• A warranty that covers only the car's engine and transmission.

• A warranty that covers damages from accidents and collisions.

What is 'Buy-Here, Pay-Here' Financing?

• An auto loan that is financed by the dealership you are getting the car from.

• A type of financing offered by banks for purchasing homes.

• A loan option provided by credit unions for buying electronics.

• A government grant for small businesses.

What is a Captive Finance Company?

• A financing division of the dealership you are getting the car from that can offer you an auto loan.

• A type of insurance company that provides coverage for high-risk drivers.

• A government agency responsible for regulating financial markets.

• A non-profit organization that offers financial education and resources.

What is a Certified Pre-owned Car?

• A used car that has been inspected, refurbished, certified and warranted by the original manufacturer.

• A brand new car with a full warranty from the manufacturer.

• A used car sold as-is without any inspection or warranty.

• A car that has been modified for racing purposes.

What is Dealer-Arranged Financing?

• A type of auto loan where the dealership connects you with a lending institution (bank, credit union, etc.).

• A loan directly from the car manufacturer.

• A cash payment option provided by the dealership.

• A type of financing where the dealership offers its own funds for the loan.

What is Depreciation?

• A decrease or loss in value.

• An increase in value over time.

• A method of inventory valuation.

• A type of financial statement.

What is an Extended Warranty?

• A service contract that provides vehicle repair at no or low cost, after the manufacturer warranty expires.

• A type of insurance for natural disasters.

• A warranty that covers only electronic devices.

• A policy that guarantees a refund for any product.

What is Financing?

• The act of providing funds for business activities, making purchases, or investing.

• The process of cooking a meal.

• The art of painting landscapes.

• The technique of playing a musical instrument.