Deck 7: Independent Living

Question 1

The Jacksons sublet their summer cottage during the winter and spring months.For each month they receive 72% of their monthly mortgage of $1,750.The Jacksons earn $1,260 for the six-month period.

Answer 1

False

Question 2

There are 15,000 shares in Marybeth's co-op.If Marybeth owns 2% of the cooperative corporation,how many shares does she own?

A) 400 shares
B) 300 shares
C) 200 shares
D) 100 shares

Answer 2

300 shares

Question 3

According to financial experts,a renter should allow no more than 25% of his or her gross income for rent.

Answer 3

False

Question 4

A lease is a written agreement between a bank and a borrower.

Question 5

How is a condominium different than a single-family dwelling?

A) Occupants pay rent to the landlord who owns the property.
B) Occupants are investors who own shares in the entire property and not individual units.
C) Occupants individually own both the home and the land.
D) Occupants jointly own the common parts of the property and individually own their own units.

Question 6

Natalie just rented an apartment for $900 a month.She was told that the rent will increase 5.5% each year.About how much will her rent be in 7 years?

A) $1,416
B) $1,308
C) $1,286
D) $1,241

Question 7

Zane received a quote to move his belongings to his new house.The estimate from the mover is $675 for 6 hours of packing and 5 hours of moving.Zane thinks he can reduce his cost by doing some of the packing and moving himself.If he does,the cost will decrease to $425 for 4 hours of packing and 3 hours of moving.If the mover charges a set hourly rate for packing and another set hourly rate for moving,what are these hourly rates?

A) Packing: $50;moving: $75
B) Packing: $40;moving: $80
C) Packing: $80;moving: $40
D) Packing: $75;moving: $50

Question 8

Row 6 of the spreadsheet below will contain the formulas to generate an amortization table.What formula will be entered into D6?

A) =B6*B2/1200
B) =B6-E6
C) =(B1*(B2/1200)*(1+B2/1200)^(B4*B3))/(1+b\B2/1200)^(B4*B3)-1)
D) B1

Question 9

What is NOT another word for renter?

A) Lessee
B) Boarder
C) Tenant
D) Landlord

Question 10

Angela has a monthly gross income of $3,000 and her expenses are $1,200.What is her back-end ratio?

A) 25%
B) 30%
C) 40%
D) 45%

Question 11

The McQuires pay a monthly mortgage payment of $938.They also pay a semi-annual property tax bill of $3,298 and semi-annual homeowner's insurance of $840.The property tax and insurance are paid monthly into an escrow account to their lender.What is their monthly payment to their lender?

A) $1,283.16
B) $1,518.6
C) $1,627.67
D) $1,672.66

Question 12

Gretchen is refinishing her gazebo that is in the shape of a regular octagon.The length of one side is 3 feet and the apothem is 3.5 feet.What is the area that Gretchen will be refinishing?

A) 10.5 sq feet
B) 24 sq feet
C) 42 sq feet
D) 63 sq feet

Question 13

A security deposit is used by a landlord to provide protection for the tenants.

Question 14

Front-end ratio is the ratio of monthly housing expenses to all expenses.

Question 15

Jamal has been approved for a $125,000,30-year mortgage with an APR of 5.3%.He made a 10% down payment and is closing on April 5th.How much should he expect to pay in prepaid interest at closing?

Question 16

Aja made a 20% down payment on a house and was approved for a $185,000 mortgage.Therefore,she should expect her closing costs to be about $3,700 to $12,950.

Question 17

Apple-Gate apartment complex uses the line graph of an exponential regression equation to model their rent increases over the past 5 years as compared to other complexes in the neighborhood.The Apple-Gate rent increases are less than other complexes in the area;therefore the slope of their graph should be steeper.

Question 18

Nathan's bedroom has a width of 13 feet,a height of 9 feet,and a length of 14 feet.The level of insulation,i,is 10 and the exposure,e,is 18 because the outside wall faces south.For this room,Nathan should purchase an air conditioner with a BTU rating of about 5,000 BTUs.

Question 19

The length of a room is 21 feet.If a floor plan has a scale of ,then the length of the room on a floor plan is 5.25 inches.

Question 20

Kate and Ashton have been approved for a $200,000 15-year mortgage with an APR of 5.5%.How much of their first monthly payment will go to interest?

A) $1,634.17
B) $1,147.57
C) $916.67
D) $717.50

Question 21

Erica is considering moving into a one-bedroom apartment in Hyde Park.The apartment has a rent of $880 and has the following fees.
- Application fee: 5% of one month's rent
- Credit application fee: $15
- Security deposit: 1 month's rent
- Lease protection: the last month's rent
- Broker's fee: 9% of one year's rent
- First month's rent
How much is Erica expected to pay up front in order to move into this apartment?

Question 22

What type of spreadsheet or table shows an accounting of the unpaid principal,monthly payment,amount allocated toward principal,and the amount allocated towards interest for a mortgage?

Question 23

When Mary and Jack bought their house,their property taxes were $3,630 annually.After 8 years,their property taxes are now $4,065.60.What percent increase is this?

Question 24

Ben and Jane have been approved for a $220,000,30-year mortgage with an APR of 5.82%.What will be their total interest for the 30 years?

Question 25

What is an ARM?

Question 26

Craig and Tammy recently sold their home for $225,000.Their loan balance is $135,680.What is their equity before paying seller's expenses?

Question 27

A rectangular room measures 21 feet by 28 feet with a 10 -foot -high ceiling.The flooring is being replaced with carpeting that sells for $10.45 per square foot and entails a $149 installation fee.What is the total pricing for the carpeting with an 8.0% sales tax?

Question 28

Matt just got a great deal on a 5,000 BTU air conditioner and decided to add a family room with an 8-foot ceiling to the back of his house.If the room faces north and he intends to make sure it is well insulated,how many square feet can his room be without exceeding the capacity of the air conditioner?

Question 29

Casey has a backyard that is a 50-by-50-foot square.She turned over an irregularly-shaped plot of soil to plant a garden.To find the area of the garden,1,500 random points are generated and 420 of the points land inside the irregularly-shaped garden.What is the area of the garden?

Question 30

Marcus is setting the corner supports for a new deck that measures 15 feet by 20 feet.To ensure that his deck is a perfect rectangle,he measures the diagonals to make sure they are the same.What length should these diagonals be?

Question 31

Nancy is buying a house and made a list of her expenses: mortgage payments,utilities,closing costs,prepaid interest,origination fee,and insurance payments.Separate each of the six expenses as either a recurring or a non-recurring cost.

Question 32

The Bradys have a gross annual income of $175,000 and have been pre-approved for a 30-year mortgage loan at 3.375% as long as the back-end ratio does not exceed 36% The house they want to buy costs $360,000,and they plan to make a down payment of 20%.Their research shows that the semi-annual property taxes for this house are $3,450.They have been given a quote from their insurance company of a $1,290 annual premium.The Bradys currently have a $579 monthly car payment and their monthly credit card bills average $2,100.Will the bank agree to finance the Bradys' dream home?

Question 33

James and Amy have decided to buy a new home that costs $240,000.They want to make a 20% down payment and finance the rest over 30 years.Their bank has offered an opportunity to buy down the quoted interest rate of 3.75% by 0.125% per point purchased.Each point will cost 1% of the amount borrowed.James and Amy were hoping the interest rate was no more than 3.375%.How long will it take for the cost of the points to be recovered by the savings in the monthly mortgage payment?

Question 34

Garrett and Erin are borrowing $170,000 to purchase a new home.They have been approved for a 30-year loan with an interest rate of 5.75%.What will be their monthly payment?

Question 35

Trystan and Kendall have decided to buy a new home that costs $300,000.They want to make a 20% down payment and finance the rest.Their bank has offered an opportunity to buy down the quoted interest rate of 4.75% by 0.125% per point purchased.Each point will cost 1% of the amount borrowed.Trystan and Kendall were hoping the interest rate was no more than 4.5% What will it cost to buy down the quoted interest rate to 4.5%?

Question 36

Nina owns a condominium where she paid $2,340 in maintenance fees this year.If her property taxes are 18% of this amount,how much did Nina pay in property taxes?

Question 37

The square footage and monthly rental of 10 similar one-bedroom apartments yield the linear regression y = 0.704x + 985.83 where x represents the square footage of the apartment and y represents the monthly rental price.Grace can afford $1,700 per month for rent.What size apartment should she be able to rent for that price?

Question 38

A rectangular room measures 14 feet by 17 feet with a 9 -foot -high ceiling.The room is being painted.Each wall will be painted with two coats and the ceiling will be painted with one coat.Each gallon of paint covers 350 square feet and costs $28.What is the total price for paint with an 8.5% sales tax?

Question 39

Name four types of fees you may incur during the closing on the purchase of a new home.