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Buying vs. Renting a Home Practice/Quiz
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Pat and his friend rent an apartment together. Their total cost to move in included first months rent, last months rent and a security deposit of $600. If Pat paid a total of $1,050 to move in, how much is his share of the rent each month?
a.
$375
b.
$450
c.
$525
d.
$750
A
Miguel wants to buy a condominium. He has the choice of buying it now or renting it with the option to buy at the end of 3 years. If he buys it now, it will cost him $6,000 to close and his mortgage payment will be $726 per month. If he rents, he must pay a move-in cost of one months rent and a security deposit of $2,000.
Miguel decides to rent because it is the cheapest option over the first 3 years. To the nearest dollar, what is the maximum amount of monthly rent payment he could pay?
a.
$670
b.
$782
c.
$814
d.
$837
C
Marquet is relocating to an area where she will be attending college. She finds a townhome with an option to rent or buy. The conditions of each are shown below.
Rent: Move-in cost of $1,350 and monthly payment of $795.
Buy: Move-in cost of $8,235 and monthly payments of $750.
Marquet plans to stay in the area for the 5 years it will take her to get a graduate degree, so she decides to buy. Choose the best evaluation of Marquet's decision.
a.
Since the costs would be the same over the 5 year period, she will have made a good decision if the property value does not decrease.
b.
She made a fairly good decision. Buying the townhome will be cheaper over the 5 year period as long as she doesn't have major repairs to make.
c.
She made a poor decision if the property value does not increase. Renting the townhome would be cheaper over the 5 year period.
d.
There is not enough information given to determine which option is best.
C
Which of the following is an advantage of renting?
a.
ease of mobility
b.
economic gain
c.
financial risk
d.
tax savings
A
Three friends decide to rent an apartment and split the cost evenly. They each paid $640 towards the total move in cost of first and last months rent and a security deposit. If rent is $650 per month, how much was the security deposit?
a.
$10
b.
$207
c.
$620
d.
$1,270
C
Latisha found an apartment that she wants to rent. The rent is $675 per month and there is a security deposit of $325. To move in, Latisha must have first months rent, last months rent and the security deposit. How much does Latisha need to move in?
a.
$1,000
b.
$1,325
c.
$1,675
d.
$2,000
C
Describe what is meant by the statement "Renting can restrict ones lifestyle."
Renters must live by the landlord's rules or guidelines. For example, a renter may not be allowed to paint, hang things on the wall, put up decorations or have pets.
Which of the following is not a typical cost associated with renting?
a.
last months rent
b.
pet deposit
c.
property tax
d.
security deposit
C
Keyon and two of his friends are going to rent a 3 bedroom apartment for $840 a month. The security deposit is $500 and the pet deposit is $265. In addition to the deposits, Keyon and his friends must pay first and last months rent. If they split the cost evenly, how much will each pay to move in?
a.
$535
b.
$613
c.
$727
d.
$815
D
Which of the following could result in higher living costs for the homeowner that the renter doesn't have?
a.
decreased property value
b.
down payment
c.
maintenance
d.
monthly payment
C
Which of the following is not an advantage of renting?
a.
ease of mobility
b.
fewer responsibilities
c.
lower initial costs
d.
restricted lifestyle
D
Mika wants to buy a condominium. He has the choice of buying it now or renting it with the option to buy at the end of 3 years. If he buys now, he could put $0 down, but he must pay closing costs of $7,100. His monthly mortgage payment will be $675.
Mika decides to rent instead of buy because it is the cheapest option over the first 3 years. His move-in costs are one months rent and a $750 security deposit.To the nearest dollar, what is the maximum amount of monthly rent payment he could pay?
a.
$636
b.
$654
c.
$828
d.
$851
C
Sally must have a total of $2,250 to move in to her new apartment which includes first months rent, last months rent, a pet deposit and a security deposit. If the pet deposit is $150 and the security deposit is $750, how much is her rent each month?
a.
$650
b.
$675
c.
$750
d.
$1,050
B
Two friends decide to rent an apartment and split the cost evenly. They each paid $575 towards the total move in cost of first and last months rent and a security deposit. If the apartment cost $325 per month to rent, how much was the security deposit?
a.
$125
b.
$250
c.
$500
d.
$825
C
Tomaso and three of his friends are splitting the cost to rent a house for $975 a month. The security deposit is $1,500 and there is a cleaning deposit of $325. They must pay first and last months rent upon moving in. Tomaso has a cat, so he will pay an additional $150 pet deposit that his friends won't. Approximately how much will Tomaso pay to move in? Round your answer to the nearest dollar.
a.
$850
b.
$944
c.
$981
d.
$1,094
D
Which of the following is not an advantage of buying a home?
Tax savings
Potential Economic Gain
Pride in Ownership
Lower Initial Cost
Lower Initial Cost
Which of the following is a typical cost associated with renting?
a.
closing costs
b.
down payment
c.
property tax
d.
security deposit
D
What is a financial risk of being a homeowner?
a.
The home may be difficult to sell.
b.
The home may need repairs.
c.
The home may decrease in value.
d.
The home may have taxes.
C
Aleisha wants to buy a condominium. She has the choice of buying it now or renting it with the option to buy at the end of 4 years. If she rents now, she must pay a deposit of $1,500 and pay rent of $865 per month. If she buys, she would need closing costs and her mortgage payment would be $844. How much would her closing costs need to be in order for the cost to buy to be the same as the cost to rent?
a.
$4,008
b.
$2,508
c.
$1,521
d.
$1,008
B
Limited mobility may be a disadvantage of buying because the home is _____.
a.
difficult to get around in
b.
difficult to sell
c.
expensive to repair
d.
far away from work
B
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