Sample Quiz 2 Attempt 1 with Complete
Solutions
Ch. 7 - Learning Objective 1
1
What is the total that Larry and his spouse can withdraw from their respective Registered
Retirement Savings Plan (RRSP) under the Home Buyer’s Plan (HBP)?
A. $20,000
B. $25,000
C. $50,000
D. $15,000
Ch. 7 - Learning Objective 2
1
Sam is looking to finance a home purchase worth $220,000 with only $11,000 as a down
payment, is it still possible for Sam to purchase this home?
A. True
B. False
2
When applying for a mortgage, the buyer will also need to plan to cover transaction costs that
include:
I. Down payment
II. Real estate commission costs
III. Closing costs
A. I and II
B. I and III
C. II and III
D. All the above
3
Is the following statement true or false: An interest adjustment occurs when there is a difference
between the date on which you take possession of your home and the date from which your
lender calculates your first mortgage payment.
A. True
B. False
Ch. 7 - Learning Objective 3
1
In general, the more frequent payments you make in a year on your mortgage, the .
, A. longer it will take you to pay off your mortgage as it increases the amortization period
B. quicker you pay off your mortgage, the more interest you pay
C. quicker you pay off your mortgage, the less interest you pay
D. longer it will take you to pay off your mortgage as it reduces the length of the loan
Ch. 7 - Learning Objective 4
1
The amortization period of the mortgage indicates how long you will take to complete your
financing payments and .
A. allows you to renew without any financial penalty
B. pay off the mortgage in full
C. lock in a fixed-rate mortgage
D. cash-in your mortgage insurance
Ch. 7 - Learning Objective 5
1
Linda has signed a mortgage contract that allows her to accelerate her mortgage payments which
means that she can reduce the overall amortization period by years as:
A. she can move to a variable rate type of mortgage.
B. she can cancel the mortgage contract any time.
C. she can double up on her monthly mortgage payment resulting in additional payments
going directly to paying off the principal.
D. she can get out of the mortgage contract without penalty.
Ch. 7 - Learning Objective 7
1
Mark has a down payment of $45,000 on a house valued at $200,000. He would be better off to
borrow an additional $5,000 on a personal loan to avoid the high ratio insurance premium.
A. True
B. False
Ch. 8 - Learning Objective 2
1
You do not need any Auto insurance as you can be self-insured whereby you would fund to cover
possible losses rather than purchasing an insurance policy.
A. True
B. False
2
No-fault auto insurance means that nobody is at fault.
Solutions
Ch. 7 - Learning Objective 1
1
What is the total that Larry and his spouse can withdraw from their respective Registered
Retirement Savings Plan (RRSP) under the Home Buyer’s Plan (HBP)?
A. $20,000
B. $25,000
C. $50,000
D. $15,000
Ch. 7 - Learning Objective 2
1
Sam is looking to finance a home purchase worth $220,000 with only $11,000 as a down
payment, is it still possible for Sam to purchase this home?
A. True
B. False
2
When applying for a mortgage, the buyer will also need to plan to cover transaction costs that
include:
I. Down payment
II. Real estate commission costs
III. Closing costs
A. I and II
B. I and III
C. II and III
D. All the above
3
Is the following statement true or false: An interest adjustment occurs when there is a difference
between the date on which you take possession of your home and the date from which your
lender calculates your first mortgage payment.
A. True
B. False
Ch. 7 - Learning Objective 3
1
In general, the more frequent payments you make in a year on your mortgage, the .
, A. longer it will take you to pay off your mortgage as it increases the amortization period
B. quicker you pay off your mortgage, the more interest you pay
C. quicker you pay off your mortgage, the less interest you pay
D. longer it will take you to pay off your mortgage as it reduces the length of the loan
Ch. 7 - Learning Objective 4
1
The amortization period of the mortgage indicates how long you will take to complete your
financing payments and .
A. allows you to renew without any financial penalty
B. pay off the mortgage in full
C. lock in a fixed-rate mortgage
D. cash-in your mortgage insurance
Ch. 7 - Learning Objective 5
1
Linda has signed a mortgage contract that allows her to accelerate her mortgage payments which
means that she can reduce the overall amortization period by years as:
A. she can move to a variable rate type of mortgage.
B. she can cancel the mortgage contract any time.
C. she can double up on her monthly mortgage payment resulting in additional payments
going directly to paying off the principal.
D. she can get out of the mortgage contract without penalty.
Ch. 7 - Learning Objective 7
1
Mark has a down payment of $45,000 on a house valued at $200,000. He would be better off to
borrow an additional $5,000 on a personal loan to avoid the high ratio insurance premium.
A. True
B. False
Ch. 8 - Learning Objective 2
1
You do not need any Auto insurance as you can be self-insured whereby you would fund to cover
possible losses rather than purchasing an insurance policy.
A. True
B. False
2
No-fault auto insurance means that nobody is at fault.
