Sloane Owes $2,600 on Her Car Loan

question 37

Multiple Choice

Sloane owes $2,600 on her car loan.According to Edmond's Used Car Prices,her car is valued at $1,950.The term used to refer to this situation is:

• A)residual value.
• B)pre-approval.
• C)capitalized cost.
• D)negative equity.
• E)money factor.

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Definitions:

Effective Price Ceiling

A government-imposed limit on how high the price of a product can be charged, set below the market equilibrium to be effective.

Equilibrium Price

The price at which the quantity of a good or service demanded meets the quantity supplied, resulting in a stable market condition.

Surplus

An excess of production or supply over demand, often resulting in lower prices or wasted resources.

Demand for Electronic Readers

The consumer desire or market requirement for digital devices designed for reading e-books and similar electronic documents.