Make your own free website on Tripod.com
 
    Name:     ID: 
 
    Email: 

Eco Ch 5

True/False
Indicate whether the sentence or statement is true or false.
 

1. 

Wearing current styles costs more than wearing classic styles.
 

2. 

Americans spend a larger percentage of their budget on clothing than ever before.
 

3. 

When deciding on the best choice in a clothing purchase, you should only consider price.
 

4. 

A shirt that requires dry cleaning has a higher cost of care than one that can be machine washed.
 

5. 

Over the past 100 years, the price of an item of clothing has gone up, but the work-time cost of the item has gone down.
 

6. 

Registration fees are paid to the automobile manufacturer.
 

7. 

Normal maintenance is an ongoing cost of owning an automobile.
 

8. 

A car loses value every year even if it is not driven.
 

9. 

Young people pay lower auto insurance rates than older people.
 

10. 

Auto insurance rates are higher in a city than in a rural area.
 

Multiple Choice
Identify the letter of the choice that best completes the statement or answers the question.
 

11. 

Which food stores typically charge the lowest prices?
a.
club warehouse stores
c.
supermarkets
b.
convenience stores
d.
small neighborhood markets
 

12. 

Private-labeled products are
a.
products labeled by consumers.
c.
bulk items.
b.
generic products.
d.
store-brand products.
 

13. 

The advantage of shopping in a convenience store is
a.
paying lower prices.
c.
saving time.
b.
having a larger selection.
d.
buying large quantities.
 

14. 

The trade-off in using cents-off coupons is
a.
higher prices.
c.
time spent collecting them.
b.
smaller selection.
d.
generic brands.
 

15. 

To determine how much you will save by buying a larger container, you would compare
a.
price per unit.
c.
newspaper ads.
b.
different brands.
d.
freshness dates.
 

16. 

For Americans, the motivating factor in clothing choice is
a.
durability.
c.
price.
b.
variety.
d.
quality.
 

17. 

A jacket that is poorly made and must be replaced after one season lacks
a.
style.
c.
durability.
b.
design.
d.
variety.
 

18. 

Over the years, the cost of clothing as a share of income has
a.
decreased.
c.
stayed the same.
b.
doubled.
d.
tripled.
 

19. 

Which of the following items has a higher cost of care?
a.
shirt that can be machine washed
b.
blouse that must be hand washed
c.
pair of slacks that must be dry cleaned
d.
sweater that must be laid flat to dry
 

20. 

The work-time cost of a coat that sells for $300 is the
a.
number of payments a buyer must make.
b.
number of hours a buyer must work to earn $300.
c.
amount of time the buyer gets to use the coat and the value placed on it.
d.
value of time spent comparison shopping for a coat.
 

21. 

Which of the following describes an advantage of owning over renting?
a.
significant tax benefits
c.
less money for other purchases
b.
large down payment
d.
real estate taxes
 

22. 

Which of the following describes an advantage of renting over owning?
a.
less privacy
c.
no property to use as collateral
b.
greater mobility
d.
no return on the rental money
 

23. 

Both the interest rate and the monthly payments remain the same over the term of the loan with a
a.
flexible rate mortgage.
c.
graduated payment mortgage.
b.
Veteran's Administration mortgage.
d.
standard fixed-rate mortgage.
 

24. 

A lease describes
a.
rights and responsibilities of the tenant only.
b.
rights and responsibilities of the landlord only.
c.
rights and responsibilities of the tenant and the landlord.
d.
interest rate on the monthly rent.
 

25. 

Monthly mortgage payments should be no more than
a.
50 percent of monthly take-home pay.
c.
monthly rental payments.
b.
one-third of monthly take-home pay.
d.
monthly food bills.
 

26. 

What is the trade-off in buying a car with a small engine?
a.
car will burn more gasoline
b.
car will protect passengers better in an accident
c.
car will accelerate less quickly
d.
car will be more costly to operate
 

27. 

What is the opportunity cost of paying cash for a car?
a.
loss of the ability to purchase other goods or services
b.
cost of an extended warranty
c.
cost of the registration fee
d.
cost of liability insurance
 

28. 

Normal maintenance on a car includes
a.
major repairs.
c.
installing options.
b.
oil changes and tune-ups.
d.
special paint.
 

29. 

A way of guarding against the cost of major automobile repairs is by purchasing
a.
liability insurance.
c.
a used car.
b.
an extended warranty.
d.
a small car.
 

30. 

Which group of people pays the highest insurance rates?
a.
single males, ages 16-25
c.
drivers with a good safety record
b.
married women, ages 25-45
d.
people who live in a small town
 

Completion
Complete each sentence or statement.
 

31. 

A ____________________ carries a limited selection of items and charges relatively higher prices than other stores.
 

 

32. 

A family that buys foods in large-quantity containers could save money by shopping at a ____________________.
 

 

33. 

_________________________ are an alternative to expensive national brands.
 

 

34. 

Most states require stores to provide ____________________ for food and other products.
 

 

35. 

The opportunity cost for using ____________________ is the value of the time you spend collecting them and matching them to items when shopping.
 

 

36. 

A renter gives the owner of a building a ____________________ to hold in case the rent is not paid or the apartment is damaged.
 

 

37. 

A renter signs a ____________________, which describes the terms under which the property is rented.
 

 

38. 

The ____________________ are fees involved in arranging for a mortgage.
 

 

39. 

The ____________________ a lender charges are computed as percentage points of the loan.
 

 

40. 

One advantage of home ownership is the creation of ____________________, which is the market value of the property minus the mortgage payments still owed.
 

 

Matching
 
 
Match each item to the correct statement below.
a.
club warehouse store
b.
convenience store
c.
private-labeled products
d.
unit pricing
e.
cents-off coupons
 

41. 

discounts offered by manufacturers on a certain brand, size, or quantity of goods
 

42. 

lower-priced store-brand products
 

43. 

store that carries a limited number of large-quantity brands and items
 

44. 

store that is open 16 to 24 hours a day, carrying a limited selection of items
 

45. 

means of comparing the costs of like amounts
 
 
Match each item to the correct statement below.
a.
durability
b.
service flow
c.
work-time cost
d.
style
e.
cost of care
 

46. 

amount of money needed for maintenance of an item
 

47. 

clothing designs that change often
 

48. 

ability of an item to last a long time
 

49. 

amount of use a person gets from an item over time and the value placed on this use
 

50. 

number of hours a person must work to earn enough money to buy an item
 
 
Match each item to the correct statement below.
a.
closing costs
b.
points
c.
lease
d.
security deposit
e.
equity
 

51. 

agreement describing the terms under which property is rented
 

52. 

money a renter lets an owner hold in case an apartment is damaged
 

53. 

fees paid to a lender and computed as percentage points of a loan
 

54. 

the market value of a property minus the mortgage payments still owed
 

55. 

fees involved in arranging for a mortgage
 
 
Match each item to the correct statement below.
a.
registration fee
b.
liability insurance
c.
excise
d.
options
e.
depreciation
 

56. 

tax on the manufacture, sale, or use of specific products
 

57. 

licensing fee, usually annual, paid to a state for the right to use a car
 

58. 

decline in value over time
 

59. 

insurance that pays for bodily injury and property damage
 

60. 

extra features and equipment on a car
 



 
Submit          Reset Help