HOUSING & TRANSPORTATION TEST
TRUE/FALSE: Mark A for True and B for False on your answer sheet.
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When renting a security deposit is often equal the amount of one month’s rent.
The value of a car at the end of its lease is called the residual value.
If leasing, it is wiser to choose an open-ended lease over a closed-ended lease.
An advantage to leasing is the ability to drive a new car more often.
Warranties are included in the cost of all used cars.
When financing your car purchase most banks will include an application or document preparation fee.
Before purchasing a new or used car you should be pre-approved by a bank on a loan amount.
New brakes and new tires are items typically covered on most warranties.
The longer the length of a car loan the lower the monthly payment.
Generally over time, cars will appreciate in value while real estate depreciates in value.
An individual with a high credit score will have a lower APR on their car and home loan.
If a consumer chooses to pay their mortgage over 15 years they will pay less in interest for the life of
their loan.
As a home owner, a leaky roof or plumbing repair must be paid for by you, whereas a renter has their
landlord pay for and take care of these repairs.
A Condominium, Single-family home, Townhouse and mobile home are all home ownership options for
a consumer.
The kitchen and bathrooms are the two rooms, if improved, can affect the resale value of a home the
most.
The additional costs of maintenance and time needed for upkeep are disadvantages home ownership.
When renting an apartment, having a roommate will increase your monthly costs.
If items, such as a computer and TV, are stolen out of your apartment your landlord is responsible for
their replacement.
Most leases on rental property are for one year but they can be negotiated between the lessor and
lesse to a different time frame.
When interest rates are low it is wise for a consumer to obtain a mortgage with an ARM.
MULTIPLE CHOICE: Select the letter of the best choice available and mark that letter on your answer sheet.
21. The dealer invoice is on average ____ of the actual sticker price.
a. 90%
b. 80%
c. 70%
d. 60%
22. All of the following are true of the Lemon Law EXCEPT:
a. Protects new cars for the 1st year after purchased
b. Protects new cars in the event of 4 defects within the 1st year
c. Protects new cars if under repair for 30 consecutive days
d. Protects only new cars purchased, not leased
23. All of the following are true of the VIN EXCEPT:
a. Stands for Vehicle Identification Number
b. Is listed on the car’s steering wheel
c. Can be used on Carfax to research the vehicle’s history
d. Contains both letters and numbers
24. All of the following are DISADVANTAGES of leasing EXCEPT:
a. No equity
b. Monthly payments
c. Mileage Restrictions
d. Limited changes can be made
25. Money paid up front at the beginning of a car lease to lower the monthly payment is called:
a. Down payment
b. Due at lease signing
c. Collateral
d. Warranty
26. All of the following items affect a used car’s value EXCEPT:
a. Mileage
b. Vehicle’s Condition
c. Year
d. Driver’s Occupation
27. All of the following items are ADVANTAGES of home ownership EXCEPT:
a. Building Equity
b. Greater privacy
c. Ability to make changes
d. Greater mobility
28. Which one of the following is NOT a tax deductible item involved with home ownership?
a. Interest on the home loan
b. Property tax
c. Energy saving improvements to the loan
d. The Principal of the loan
29. All of the following items are included in a monthly mortgage EXCEPT:
a. Principal
b. Interest
c. Property Taxes
d. Electricity usage
30. The warranty on a car with a 100,000 / 10 year warranty will expire after:
a. 100,000 miles
b. 10 years
c. whichever happens first
d. whichever happens last
31. Jane likes to drive a new car every 2 or 3 years. Financially it would be the wisest decision for her to:
a. Lease
b. Rent
c. Buy new
d. Buy used
32. The MSRP must be stated and located on the window of all _____ cars
a. new
b. used
c. leased
d. rental
33. A lease where the dealer can add on additional costs to the driver after the lease period ends is called:
a. Due at lease signing
b. Open-ended lease
c. Closed-ended lease
d. Lease to own
34. All of the following are additional costs that could be associated with a rental property EXCEPT:
a. Lawn care maintenance
b. Electricity bill
c. Parking
d. Property Tax bill
35. Cars generally depreciate the most in value in the _____ year.
a. First
b. Second
c. Third
d. Fourth
36. The complete history of a car is available through getting a(n):
a. Equifax
b. Carfax
c. Credit Report
d. Downpayment
37. When buying a new or used car all of the following are expenses that must be paid EXCEPT:
a. Tax
b. Title
c. License
d. Test Drive
38. Before purchasing a car or a home you should go to a financial institution to do this, which is check
how much you can spend and borrow on your purchase.
a. Credit Score Inquiry
b. Test Drive
c. Pre-Approved
d. Inspection
39. Financial experts suggest that consumers save at least 10% of their net income each month. Housing
expenses should make up ____ % of your net income and all car-related expenses ____%.
a. 25%; 50%
b. 50%; 25%
c. 50%; 50%
d. 25%; 25%
40. A mortgage where a borrower’s interest may fluctuate based on the interest rate in the market is
known as a(n):
a. ARM
b. FRM
c. Annual rate Mortgage
d. Fixed Rate Mortgage
41. A homeowner’s association will generally cover the cost of all of the following EXCEPT:
a. damages & repairs to shared or common areas
b. lawn care and landscaping costs
c. theft of personal property inside your unit
d. pool or fitness center upkeep, if one exists
42. All of the following are possible restrictions when renting a property EXCEPT?
a. Removing or painting walls
b. No pets
c. Noise regulations
d. Race/Ethnicity rules
43. All of the following appliances are typically considered part of the purchase price when buying a home
EXCEPT:
a. Dishwasher
c. Oven
b. Refrigerator
d. Television
44. Which of the following items will appreciate the value of a home?
a.
b.
c.
d.
Negative report on school system in the neighborhood
Overgrown and poorly kept property of adjacent homes
Finishing the basement
Greater supply of homes for sale than demand
45. All of the following will cause depreciation in a car EXCEPT:
a. Mileage
c. Rust
b. Wear and tear
d. Rare collectible
46. Which one of the following maintenance expense should occur most often with your car?
a. tire rotation
c. new brakes
b. new engine
d. oil change
47. The ________ tracks the total miles in your car while the ______ can track the miles for one trip.
a. pedometer; tripometer
c. odometer; tripometer
b. tripometer; speedometer
d. speedometer; pedometer
48. For the average American, a car or truck is the ____ purchase they make.
a. most expensive
b. second most expensive
c. third most expensive
d. fourth most expensive
49. Karen wants to purchase a home similar to an apartment that provides the use of facilities such as a
swimming pool, tennis courts, and workout area. She does not want to be responsible for taking care of a lawn,
gardens, or maintaining the structure. What can he purchase?
a. small efficiency home
b. condominium
c. single-family home
d. mobile home
50. Which of the following geographic regions of the U.S. has the highest property values?
a. Omaha, NE
c. San Diego, CA
b. Chicago, IL
d. Nashville, TN