Car Dealer License Test with correct Answers

Car Dealer License Test with correct Answers Which of he following are permitted methods for computing interest rates a. The pre-computed Basis method b. The simple Interest basis method c. The Friedman Method d. Both A & B - ANSWER -d. Both A & B The maximum a dealer may charge a customer for a smog test is: a. $8 b. $12 c. $50 d. $45 - ANSWER -c. $50 The basic DMV transfer fee to transfer the title into the buyer's name is a. $15 b. $12 c. $80 d. $25 - ANSWER -a. $15 If the buyer defaults on a conditional sales contract, the dealer may, subject to proper notification to the buyer a. Accelerate amount due b. Repossess vehicle c. Sell vehicle d. All of the above - ANSWER -d. All of the above Which of the following are taxable in a vehicle sales transaction? a. document preparation fee b. $50 Smog fee paid to the seller/dealer c. Both A & B d. Insurance fees - ANSWER -c. Both A & B Which of the following are not taxable in a vehicle sales transaction? a. Finance Charges b. Insurance charges c. Smog certificate fee (paid to the state) d. All of the above - ANSWER -d. All of the above Buy here pay here (self-financing) dealers must: a. Charge interest rates that are 20% less than 20% above prime rate b. Offer 30 day or 1,000 mile warranties, and put fair market value notices on their vehicles c. send 50% of all interest charged to DMV d. Finance all vehicles sold for more than $50,000 - ANSWER -b. Offer 30 day or 1,000 mile warranties, and put fair market value notices on their vehicles Which of the following is a required safety equipment item a. Padded dashboards b. Smog Equipment c. Door Locks d. Reclining Seatbacks - ANSWER -b. Smog Equipment Advertisements must identify the dealer by which of the following a. Phone number b. The dealership name c. "dlr" d. "Dealer" - ANSWER -b. The dealership name If a vehicle has been sold, any advertising on that vehicle must be withdrawn within: a. 12 hours b. 48 hours c. 36 hours d. One Week - ANSWER -b. 48 hours If a dealer buys a vehicle with an odometer that is not working, the dealer must a. Tell the buyer that the odometer is broken b. Repair the odometer before selling the vehicle c. Sign a declaration the odometer is not operating to be filed with DMV d. Do nothing - ANSWER -b. Repair the odometer before selling the vehicle Where the dealer repairs an odometer, and the odometer is incapable of registering the same mileage as before service, the dealer must: a. Set the odometer to 0 b. Attach a written notice to the left doorframe specifying the previous mileage and date of repair c. Estimate mileage and set the odometer to that mileage d. Both A & B - ANSWER -d. Both A & B Is it ever legal for a dealer to reset, or "roll back" an odometer to show less than the actual mileage? a. Yes if the dealer tells the buyer how much he rolled back the odometer b. Yes if the dealer puts the original mileage in writing on the contract c. Yes if the dealer asks the buyer if it is okay with them to do the roll back d. No - ANSWER -d. No DMV requires special plates (dealer plates) be placed where on the vehicle? a. On the dashboard b. In the rear window c. In the rear, over the existing license plate d. On the trunk, or hanging off the bumper - ANSWER -c. In the rear, over the existing license plate Auto brokers must do which of the following a. Limit deposits to 2.5% of the purchase price, and all deposits in a separate trust account b. Use any deposits received to pay the broker - ANSWER -a. Limit deposits to 2.5% of the purchase price, and all deposits in a separate trust account Which of the following is not required to transfer a vehicle a. Endorsed Certificate of Ownership b. A report of prior service records for the vehicle since new c. Odometer mileage reading