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Chapter 12 & 14 Review Game Question 1 Examples of car dealer add-ons are ____. a. rust proofing b. paint sealers c. stain resistant upholstery fabric d. all of the above Answer d. all of the above Question 2

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chapter 12 14

Chapter 12 & 14

Review Game

question 1
Question 1

Examples of car dealer add-ons are ____.

a. rust proofing

b. paint sealers

c. stain resistant upholstery fabric

d. all of the above

answer
Answer

d. all of the above

question 2
Question 2

A timetable for checking systems and replacing parts on a new car is the ____.

a. tire schedule

b. fluid gauge

c. maintenance schedule

d. none of the above

answer5
Answer

c. maintenance schedule

question 3
Question 3

The manufacturer's suggested retail price listed on a sticker in a new car's window is the ____.

a. odometer

b. option

c. sticker price

d. none of the above

answer7
Answer

c. sticker price

question 4
Question 4

Used car parts that were repaired or restored to working order to be installed as replacements are ____.

a. rebuilt parts

b. features

c. options

d. none of the above

answer9
Answer

a. rebuilt parts

question 5
Question 5

The amount the dealer paid to buy the car from the manufacturer is the ____.

a. invoice price

b. sticker price

c. leasing price

d. none of the above

answer11
Answer

a. invoice price

question 6
Question 6

Franco has been leasing a car from a local dealership. At the end of his three-year lease agreement, he will pay a fee that will cover the cost of getting the car ready to sell or lease to someone else. This fee is known as ____.

a. wear and tear fee

b. residual fee

c. disposition fee

d. acquisition fee

answer13
Answer

c. disposition fee

question 7
Question 7

Six months ago, Regina purchased a new vehicle from a local car dealership. After just two weeks, she had the car towed to the dealership because of electrical problems. In addition the cooling system malfunctioned; a major computer problem kept her car in the dealer's repair shop for 35 days. Because all of the problems occurred during the car's warranty period, Regina's car is defined as ____.

a. a lemon

b. rebuilt

c. reconditioned

d. none of the above

answer15
Answer

a. a lemon

question 8
Question 8

If the invoice price of a vehicle is $22,500, approximately what would the sticker price of this same vehicle be?

a. $22,500

b. $25,425

c. $23,100

d. $24,750

answer17
Answer

d. $24,750

question 9
Question 9

At the end of the lease period on her car, DeShawn will take the vehicle to the dealership. Among other things, the dealer will check the number of miles she has driven. How will the dealership measure the miles she traveled while leasing the vehicle?

a. mileage calculator

b. odometer

c. the tread on the car's tires

d. all of the above

answer19
Answer

b. odometer

question 10
Question 10

For an extra $1,000 Yoriko can purchase additional repair coverage on her new vehicle. This additional coverage is purchased from the dealer and is known as ____.

a. basic warranty

b. yearly inspection coverage

c. extended warranty

d. dealer warranty

answer21
Answer

c. extended warranty

question 11
Question 11

When Britney was talking with a car salesperson regarding a lease agreement, she learned she would have to make an initial payment to cover the cost of setting up the lease. This fee also included a security deposit that is refundable at the end of the lease. This fee is known as a(n) ____.

a. acquisition fee

b. residual fee

c. cost reduction fee

d. capitalization fee

answer23
Answer

a. acquisition fee

question 12
Question 12

Austin noticed that his used car's performance had declined slightly over the past week. It does not accelerate as quickly and a loud knocking noise occurs when he reaches 50 mph. He takes his car to a local repair shop and describes the symptoms to the mechanic. The mechanic asks Austin to leave his car so that it can be thoroughly checked. Later that same day the repair shop describes in writing the services it will perform and the price for the labor and parts to fix Austin's car. This document is known as a(n) ____.

a. diagnostic

b. estimate

c. guarantee

d. both B and C

answer25
Answer

b. estimate

question 13
Question 13

Because he is in no hurry to buy her new car, in what two months will Wyn find car sales are typically slow at car dealerships, thereby allowing him to negotiate a better price?

a. December and May

b. August and January

c. August and December

d. none of the above

answer27
Answer

c. August and December

question 14
Question 14

The amount an item is currently worth is its ____.

a. market value

b. quote

c. insurance

d. none of the above

answer29
Answer

a. market value

question 15
Question 15

An insurance contract is a(n) ____.

a. invoice

b. policy

c. condo

d. none of the above

answer31
Answer

b. policy

question 16
Question 16

A regular payment required to purchase insurance is a ____.

a. bid

b. premium

c. bond

d. none of the above

answer33
Answer

b. premium

question 17
Question 17

An expert's determination of the value of a piece of property is known as a(n) ____.

a. premium

b. claim

c. appraisal

d. none of the above

answer35
Answer

c. appraisal

question 18
Question 18

A special addition to an insurance policy that covers a specific loss not covered in the standard policy is a ____.

a. point

b. rider

c. deductible

d. none of the above

answer37
Answer

b. rider

question 19
Question 19

Insurance that only pays for damage you caused to another vehicle is called ____.

a. a deductible

b. comprehensive coverage

c. property damage liability insurance

d. none of the above

answer39
Answer

c. property damage liability insurance

question 20
Question 20

Insurance that pays for damage to your car caused by something other than a collision is called ____.

a. collision insurance

b. points

c. comprehensive coverage

d. none of the above

answer41
Answer

c. comprehensive coverage

question 21
Question 21

The amount you pay for a loss before the insurance company pays anything is known as a ____.

a. deductible

b. risk

c. coverage

d. none of the above

answer43
Answer

a. deductible

question 22
Question 22

The insurance that covers your own care when in an accident that was your fault is called ____.

a. liability insurance

b. collision insurance

c. comprehensive insurance

d. none of the above

answer45
Answer

b. collision insurance

question 23
Question 23

Each time Guy gets a ticket or causes an accident, his state Bureau of Motor Vehicles is notified. This information becomes a part of Guy's driving record; his insurance company can then look at his driving record to determine whether to increase or decrease his premium. With each instance that is reported, what is added to his official record that could increase his car insurance premium?

a. points

b. risk factors

c. rate

d. none of the above

answer47
Answer

a. points

question 24
Question 24

Three years ago, Herschell purchased leather furniture for his den at a cost of $4,000. An electrical fire in his den destroyed the furniture. In order to buy a sofa at today's prices similar to the furniture destroyed, what type of insurance coverage should Herschell have?

a. market value

b. liability value

c. current value

d. replacement value

answer49
Answer

d. replacement value

question 25
Question 25

Valora purchased a new car rather than a used car so that if the car had mechanical problems, the cost of the repairs would be covered for three years or 36,000 miles. This repair coverage is known as the vehicle's ____________________.

answer51
Answer

warranty

question 26
Question 26

Once Atsuko completes the loan documents for her new car and obtains the necessary insurance, she can drive it home. The ____________________ provides her with more information about her car including the location of controls and the operation of those controls.

answer53
Answer

owner's manual

question 27
Question 27

Avelia recently leased a car. The number of miles Avelia is allowed to drive her leased vehicle without being charged extra per mile is known as the ____________________.

answer55
Answer

mileage allowance

question 28
Question 28

A formal request made to an insurance company for payment of a loss is called a(n) ____________________.

answer57
Answer

claim

question 29
Question 29

A regular payment required to purchase insurance is called a(n) ____________________.

answer59
Answer

premium

question 30
Question 30

A driver who has been assigned an insurance company by the state because of a bad driving record is said to be a(n) ____________________ risk.

answer61
Answer

assigned

question 31
Question 31

Brianna is reviewing her automobile insurance. If she is concerned about being involved in an accident with another driver who does not have automobile insurance, she should purchase ____________________.

answer63
Answer

uninsured/underinsured motorist coverage

question 32
Question 32

Liam and Tess are in the market for a new car. They have found a vehicle they like with the features and options desired. The sticker price of the car with their desired options is $22,300; the invoice price of the car is $18,000. They want to pay a fair price for the vehicle and the options they desire. How can they calculate a fair price for the car in order to begin negotiations with the car dealership?

answer65
Answer

A fair profit for the dealer is about 3 percent of the invoice price of the car plus options. In Liam and Tess' case, 3 percent of $18,000 would give the dealer $540 profit. They would start with the invoice price ($18,000) and add $540 to it for a total of $18,540. From here they should add in the cost of any features and options and subtract dealer rebates and incentives. The result of these calculations is a fair price for the vehicle and a good place to begin negotiations.

question 33
Question 33

For two years, Alejandra has used public transportation to make the commute from her apartment to work. Although this arrangement is economical, it is not often convenient for her schedule. She has saved money toward the purchase of a car, but she is not sure if she can afford a car or not. Furthermore, she is undecided on whether to buy a used or new car. What can you tell her about her ability to afford a car and what to consider in purchasing both a used and new car?

answer67
Answer

As a general rule, Alejandra can afford a car loan payment of no more than 20 percent of her take-home pay. The most important advantage of owning a new car is its reliability. Certainly a new vehicle will have a new design and look and will technologically be safer and have improved gas mileage. Furthermore, new cars come with some type of warranty to cover the cost of repairs. However, purchasing a used car from an individual does not include a warranty. A new car is more costly than a used car. Alejandra can check the mileage by looking at the used car's odometer. Used cars are more likely to have repairs than new cars. In evaluating a used car, Alejandra will need to examine it carefully for mismatched paint or and exterior panels that don't fit. These are signs that a used car has been in an accident. She should check for rust underneath the car; check the controls and lights and look for fluid leakage. She should examine the exhaust for blue smoke, which is an indicator that the used car is burning oil. Small amounts of white smoke are normal; large clouds mean serious engine problems.

question 34
Question 34

Ben has full coverage on his car. He has an accident for which he was at fault and his car was a total loss. He carries a $500 deductible insurance with a current value of his car at $15,900. How much will he receive from the insurance company? How might his insurance be affected by the accident?

answer69
Answer

After Ben's $500 deductible, his insurance will pay the remaining $15,400 value of his car. Additionally, his rates will increase (increase in points) due to the accident.

question 35
Question 35

Sid and Clarice recently purchased an old Victorian style house. They want to make sure that they are adequately covered in the event disaster strikes and they lose their home. Yet, they want to minimize the cost of this insurance as much as possible. Can you help them determine how much insurance they should be and what they can do to reduce the cost of their homeowner's insurance?

answer71
Answer

Sid and Clarice should follow the 80-percent rule. That is, insurance companies are not required to reimburse them for the total loss of their home unless they have at least 80-percent coverage. Because homes increase in value, they should arrange to have their coverage increased automatically to make sure to account for this natural increase in value. To reduce insurance costs they can install a security system. Because their home is older, the electrical system has aged and may be more likely to cause a fire. They could consider replacing the electrical wiring. They could install smoke detectors and make sure fire extinguishers are installed in their home. They could further upgrade their home by replacing the plumbing and pipes to prevent breakage and freezing during cold winter months.