Purchasing Unit
Review
1
If the cost of an oil change
is $30 and you change your
oil every 3,000 miles, what
is the cost per mile?
a. $0.01
b. $0.03
c. $0.10
d. $0.30
2
Teenagers see about ______
advertisements per day.
a. 1,000
b. 2,000
c. 3,000
d. 4,000ily know
3
Which of the following would NOT be
a factor when calculating the true
cost per mile for a car:
a.
b.
c.
d.
Depreciation
Cost of insurance
Cost of gas & oil changes
Cost of interest, if purchased
with a car loan
e. Cost of maintenance & repairs
f. All of the above are factors
4
True or False:
It is usually best to
negotiate a deal for a car by
starting with the MSRP and
working downward from
there.
5
The MSRP of a car is the:
a. Dealer’s cost of the car
b. True market value that will
you likely pay for the car
c. The sticker price on the
window of the car
d. The dealer’s invoice price
for the car
6
True or False:
A single class action law can
be filed covering individuals
who suffer from different
problems by the same
company.
7
True or False:
The best times to buy a car
is usually at the beginning of
the month or when the
dealer advertises a sale in
the newspaper.
8
If gas costs $2.49 per
gallon and your car gets 25
miles per gallon, what is the
approximate cost per mile?
a. $0.01
b. $0.02
c. $0.10
d. $0.25
9
True or False:
The monthly cost to lease a
car is typically less than the
monthly cost to buy it with
a car loan.
10
Which of the following should you
do FIRST in order to make a good
purchasing decision?
A. Search for information
B. Recognize the problem
C. Do a post-purchase evaluation
D. Make the purchase decision
E. Evaluate the alternatives
11
What magazine should you
check out before making any
important purchases?
a. Consumer Digest
b. Consumer Reports
c. Consumer Inquest
d. Consumer News
12
True or False:
An express warranty is an
unwritten guaranty from the
seller outlining the
conditions under which a
product can be returned.
13
If car repairs cost $4,000
over 5 years and you drive
12,000 miles per year, what
is the cost per mile?
a. $0.07
b. $0.12
c. $0.33
d. $3.00
14
True or False:
Arbitration is generally a
binding form of dispute
resolution.
15
True or False:
Dealer incentives are
reductions in price which are
paid by the car dealership.
16
True or False:
Increasing the down
payment on a lease will
reduce the monthly lease
payments.
17
Which of the following should you
do FIRST if you have a complaint
about a purchase?
A. Contact a consumer agency
B. Contact company headquarters
C. Initiate dispute resolution
D. Return to the place of business
E. Take legal action
18
True or False:
You should bring all your
pricing and other research
to the dealer with you.
19
_________ is the estimated value
of a car at the end of a lease
period.
A. Gross Cap Cost
B. Depreciation
C. Adjusted Cap Cost
D. Money Factor
E. Residual
F. Lease Quotient
20
The money factor for a lease is:
A. The interest rate times 2400
B. The interest rate divided by 2400
C. Multiplied by (the cap cost minus
the residual) to determine the
interest on a lease
D. Divided by (the cap cost minus
the residual) to determine the
interest on a lease
21
True or False:
Fraud is a dishonest
business practice which a
seller tries to deceive or
mislead the buyer.
22
True or False:
If offered an extended
service contract on a
product, you should usually
take it.
23
True or False:
When shopping for a car,
you should start at the
nearest dealer since you will
likely wind up buying it there
eventually anyway.
24
Which of the following would
handle an issue such as the
recall of the lawnmower
which might pose a fire risk?
a. Consumer Product Safety
Council
b. Food & Drug Administration
c. Better Business Bureau
d. Consumer Advocacy Board
25
True or False:
The maximum amount you
could recover in small claims
court is $3,000 for most
disputes in New Jersey.
26
Which of the following is NOT a
consumer agency run by the
US government?
a. Consumer Product Safety
Council
b. Food & Drug Administration
c. Better Business Bureau
d. All of the above are run by
the US government
27
True or False:
The price of most things you
can purchase at a Car
Dealer F&I Office (e.g. an
extended warranty) are not
negotiable.
28
Which of the following is the
best thing you should
consider buying at the Car
Dealer F&I Office?
a. Extended warranty
b. Undercoating
c. VIN etching
d. Paint sealant
e. Gap insurance
f. Maintenance plan
29