1. Jessie Ridley just bought an SUV and financed with an automobile loan. She will pay 48 payments of $425 each and one final payment of $3,000. What type of clause is in her sales contract?
a. Prepayment penalty
b. Acceleration
c. Reposession
d. Balloon
2. "Gap" insurance
a. is very profitable for the dealer.
b. is a good deal for the buyer.
c. pays off the loan balance if the insurance payment is insufficient as well as being very profitable for the dealer.
d. pays off the loan balance if the insurance payment is insufficient.