BUSI 223 BUSI223 Quiz 4 Personal Finance (Liberty)
BUSI 223 Quiz 4 Personal Finance
1. Having a checking account tells a creditor that you have some experience in managing your own funds.
2. Pete and Pam want to purchase a new home but don’t know how much mortgage they can qualify for. The lender requires total installment loan payments not exceed 32% of gross monthly income. Based on Pete and Pam’s financial data below, what is the maximum monthly mortgage payment for which they can qualify? Monthly Gross Income $5,000; Car payment $400; Student Loan Payment $300; Current Rent Payment $1,000.
3. One can and should check one’s credit bureau file regularly.
4. Mike and Teresa Garza have a monthly gross income of $5,000 but they pay $1,000 per month in taxes. They also pay $2,000 per month in various loan payments. What is their debt service ratio?
5. Which of the following are reasons people lease vehicles?
6. The lender uses a credit application to determine whether the borrower has the _____ to handle the debt.
7. The purpose of a credit investigation is to evaluate the kind of risk you pose to the lender.
8. A debt safety ratio of 5% would generally be a signal of financial trouble ahead.
9. One who leases an automobile is typically responsible for early termination costs, even when early termination is due to theft or auto accidents.
10. Anna purchased a vehicle six years ago for $25,000. She recently sold it for $5,000. Over the years, she paid a total of $5,800 on auto insurance, $4,800 on gas and maintenance and $2,500 in interest. What was her depreciation cost on this vehicle?
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