Title: QUIZ: What Is the Cost of Choosing to Rent-to-Own? (It's Your Paycheck, Lesson 9) Module
Course: FRE Resources > Section: What Is the Cost of Choosing to Rent-to-Own? (It's Your Paycheck, Lesson 9) Module

Q: Which of the following best defines a contract?
- A casual agreement between friends
- A legally binding exchange, promise, or agreement between parties enforceable by law
- A verbal promise that is not legally enforceable
- A written document detailing a business plan
A: A legally binding exchange, promise, or agreement between parties enforceable by law
If right: That is correct.
If wrong: That is incorrect. A contract is a legally binding exchange, promise, or agreement between parties enforceable by law.

Q: Which of the following are the key elements of a contract?
- Consideration, legal objective, mutual agreement
- Consideration, competent parties, individual agreement
- Consideration, competent parties, mutual agreement
- Consideration, competent parties, legal objective
A: Consideration, competent parties, mutual agreement
If right: That is correct.
If wrong: That is incorrect. The key elements of a contract include consideration, competent parties, and mutual agreement.

Q: Which of the following is a disadvantage of rent-to-own instead of purchasing an item outright?
- Lower initial cost
- No additional fees
- Financial disclosure laws always apply
- Higher overall cost and potential additional fees
A: Higher overall cost and potential additional fees
If right: That is correct.
If wrong: That is incorrect. The disadvantage of rent-to-own instead of purchasing an item outright is the higher overall cost and potential additional fees.

Q: In a typical rent-to-own agreement, if a renter misses a payment,
- an extra fee is added to the next payment.
- the rental rate increases for the rest of the term of the loan.
- the renter is required to return the item for a partial refund.
- the renter is required to return the item and has nothing to show for the money spent.
A: the renter is required to return the item and has nothing to show for the money spent.
If right: That is correct.
If wrong: That is incorrect. In a typical rent-to-own agreement, if a renter misses a payment, the renter is required to return the item and has nothing to show for the money spent.

Q: In what situation would it be beneficial to use a rent-to-own agreement to buy a television?
- Ethan is on a temporary three-month work assignment in New York, living in a furnished apartment, but has no television.
- Samantha wants a new television but is not sure if she can afford it.
- Alex wants a new television and doesn't want to wait long enough to save the money.
- Emma wants a new television and has a poor credit rating; she doesn't have the money and can't get a loan.
A: Ethan is on a temporary three-month work assignment in New York, living in a furnished apartment, but has no television.
If right: That is correct.
If wrong: That is incorrect. Since Ethan is on a temporary work assignment, choosing to use a rent-to-own agreement for a few months is a reasonable option.

Q: What is the rent-to-own total for a computer tablet if the monthly payments are $42.99 for 23 months?
- $988.77
- $989.00
- $1031.76
- $980.99
A: $988.77
If right: That is correct.
If wrong: That is incorrect. The computer tablet costs $988.77 ($42.99 x 23 = $988.77).