Managing Financial Information

Question 1

Borrowers choosing an adjustable-rate mortgage

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often pay a lower interest rate during the first few years.

Question 2

The chart shows the costs associated with the purchase of a new home.

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There are additional fees and costs involved in taking out a mortgage.

Question 3

The table shows the terms of a fixed-rate mortgage.

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M = P StartFraction Left-bracket R (1 + R) Superscript n Baseline Right-Bracket Over Left-bracket (1 + R) Superscript n Baseline minus 1 Right-bracket EndFraction

Question 4

What best explains the relationship between a borrower’s credit score and a down payment requirement?

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Someone with a high credit score may be required to make a lower down payment.

Question 5

The chart shows the costs associated with the purchase of a new home.

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costs associated with obtaining the loan.

Question 6

Homeowners typically pay property taxes to

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help finance state and local governments.

Question 7

The graph shows the average price of homes in the United States from 2009 to 2014.

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Rising home prices in recent years means that more people will need to take out mortgages.

Question 8

When people take out a mortgage, they must pay back the money

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over time, usually many years.

Question 9

Many people prefer a fixed-rate mortgage because it

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is predictable.

Question 10

What impact might an economic downturn have on a borrower’s fixed-rate mortgage?

Revolt · Accepted Answer

It has no impact because a fixed-rate mortgage cannot change.

Managing Financial Information Answers

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