Understanding Business and Personal Law

Chapter 16: Owning a Vehicle

Owning a Vehicle


1.	The federal odometer law requires that everyone who transfers a vehicle, unless it is more than 25 years old, provide a written mileage disclosure statement.
		A)	TRUE
		B)	FALSE


2.	Lemon laws are designed to protect consumers when they purchase
		A)	vehicles in which the odometer has been turned back.
		B)	defective used vehicles.
		C)	defective new vehicles.
		D)	defective vehicles, either new or used.


3.	All used cars must come with a 90-day guarantee if sold by a dealer.
		A)	TRUE
		B)	FALSE


4.	When trading in a vehicle, ask the dealer for help in determining its value before negotiating the best price for your new car.
		A)	TRUE
		B)	FALSE


5.	The APR is the
		A)	interest rate charged by the car dealer.
		B)	true interest rate of the loan.
		C)	number and amount of payments you will make on your loan.
		D)	cost of the loan in dollars and cents.


6.	Laws are being adopted in many states to require vehicle repair shops to have
		A)	specific training for mechanics.
		B)	both male and female mechanics on staff.
		C)	arbitrators on stand-by to hear complaints by consumers.
		D)	posted signs showing the average fuel economy standards for all motor vehicles.


7.	Bodily liability insurance
		A)	protects the insured against claims or lawsuits for injuries or death caused by negligence.
		B)	protects you when another driver has insurance, but not enough to pay for any injuries.
		C)	provides protection when the insured is injured in an automobile accident that is caused by a driver with no insurance.
		D)	pays for medical expenses resulting from bodily injuries to anyone occupying the policyholder's car in an accident.


8.	The main advantages of leasing a vehicle are
		A)	unlimited mileage and no limits or charges for excess wear on the car.
		B)	the car is usually less expensive and you have a vehicle to trade-in at the end of the lease.
		C)	a low down payment and smaller monthly payments.
		D)	you own the vehicle at the end of the leasing term and the up-front costs are low.


9.	Comprehensive insurance applies to damage to your vehicle when it is in an accident and pays for vehicle repairs, regardless of who was at fault.
		A)	TRUE
		B)	FALSE


10.	The FTC's Used Car Rule requires that a large sticker, called a Buyer's Guide, be placed in the window of each used car offered for sale.
		A)	TRUE
		B)	FALSE