Question 1

You should review your credit bureau file every year.

Accepted Answer

A) True 
 B)False

Question 2

Which of the following cards provides direct access to your checking account?

Accepted Answer

A) Retail charge cards 
B) Affinity cards 
C) Student credit cards 
D) Reward cards 
E) Bank debit cards 
A) Retail charge cards 
B) Affinity cards 
C) Student credit cards 
D) Reward cards 
E) Bank debit cards

Question 3

Which of the following is usually excluded from a monthly credit card statement?

Accepted Answer

A) The minimum payment 
B) The payment due date 
C) The type of goods purchased 
D) The account activity during the current period 
E) The interest rate 
A) The minimum payment 
B) The payment due date 
C) The type of goods purchased 
D) The account activity during the current period 
E) The interest rate

Question 4

The decision about whether or not to grant you credit will be made by:

Accepted Answer

A) individual creditors. 
B) local credit bureaus. 
C) the credit cardholder. 
D) the Federal Trade Commission. 
E) national credit bureaus. 
A) individual creditors. 
B) local credit bureaus. 
C) the credit cardholder. 
D) the Federal Trade Commission. 
E) national credit bureaus.

Question 5

Which of the following statements about the cash advances that the holder of a bank credit card can obtain from participating banks is true?

Accepted Answer

A) Cash advances are loans on which interest begins to accrue only when the borrower uses them to make purchases. 
B) Cash advances without any limits can be withdrawn from an ATM using credit cards. 
C) Cash advances obtained from the teller window at a bank are limited by the unused credit in the borrower's account. 
D) Cash advances can be obtained only during the hours the bank is open. 
E) Cash advances are loans obtained from an ATM using credit cards that do not allow merchandise purchases. 
A) Cash advances are loans on which interest begins to accrue only when the borrower uses them to make purchases. 
B) Cash advances without any limits can be withdrawn from an ATM using credit cards. 
C) Cash advances obtained from the teller window at a bank are limited by the unused credit in the borrower's account. 
D) Cash advances can be obtained only during the hours the bank is open. 
E) Cash advances are loans obtained from an ATM using credit cards that do not allow merchandise purchases.

Question 6

Sheldon has a home valued at $108,000 with an outstanding mortgage of $70,000. If his lender is willing to provide a home equity loan of up to 80% of the market value of his home, how much can Sheldon borrow using a home equity loan?

Accepted Answer

A) $86,400 
B) $80,000 
C) $38,000 
D) $30,400 
E) $16,400 
A) $86,400 
B) $80,000 
C) $38,000 
D) $30,400 
E) $16,400

Question 7

The majority of persons filing for bankruptcy choose Chapter 7 of the U.S. Bankruptcy Code.

Accepted Answer

A) True 
 B)False

Question 8

Your credit bureau file often includes information about your political and religious affiliations.

Accepted Answer

A) True 
 B)False

Question 9

If the information in an individual borrower's credit report contains an error, he or she is entitled to:

Accepted Answer

A) request a correction. 
B) sue the credit bureau. 
C) erase the credit report. 
D) refuse to provide credit information. 
E) withdraw from the credit bureau. 
A) request a correction. 
B) sue the credit bureau. 
C) erase the credit report. 
D) refuse to provide credit information. 
E) withdraw from the credit bureau.

Question 10

If you are expecting difficulties in making your payments, it is recommended that you:

Accepted Answer

A) talk to the creditors. 
B) declare bankruptcy. 
C) file a legal complaint. 
D) obtain more credit. 
E) transfer your debt to another creditor. 
A) talk to the creditors. 
B) declare bankruptcy. 
C) file a legal complaint. 
D) obtain more credit. 
E) transfer your debt to another creditor.

Question 11

Which of the following is not requested in a typical credit card application?

Accepted Answer

A) Charge accounts 
B) Housing 
C) Employment 
D) Income 
E) Political affiliations 
A) Charge accounts 
B) Housing 
C) Employment 
D) Income 
E) Political affiliations

Question 12

For a fee, local credit bureaus can provide credit information to members about prospective borrowers in their community.

Accepted Answer

A) True 
 B)False

Question 13

Credit offered in the form of _____ is most common in department and clothing stores and other high-volume outlets, where customers are likely to make several purchases each month.

Accepted Answer

A) collateralized credit cards 
B) reward credit cards 
C) affinity cards 
D) retail charge cards 
E) student credit cards 
A) collateralized credit cards 
B) reward credit cards 
C) affinity cards 
D) retail charge cards 
E) student credit cards

Question 14

William uses his bank credit card frequently; however, he always pays off the total outstanding balance on the card each month. What should William look for in a credit card given the way he uses one?

Accepted Answer

A) A low annual fee and a grace period 
B) A low annual fee and a low interest rate 
C) No annual fee and a grace period 
D) No annual fee and a low interest rate 
E) A high annual fee and a low interest rate 
A) A low annual fee and a grace period 
B) A low annual fee and a low interest rate 
C) No annual fee and a grace period 
D) No annual fee and a low interest rate 
E) A high annual fee and a low interest rate

Question 15

The market value of your house is $175,000, and you have a first mortgage balance of $100,000. If a lender requires an 80% loan-to-market value ratio, how large could your home equity loan be?

Accepted Answer

Home Equity Loan = ($175,000 ×

Question 16

A straight bankruptcy:

Accepted Answer

A) eliminates all the obligations of a debtor. 
B) results in the loss of all the assets of a debtor. 
C) results in the repayment of debt within 3 to 5 years. 
D) exempts a debtor from all the tax payments and payments for alimony and child support. 
E) allows a debtor to retain some other personal assets as per federal regulations. 
A) eliminates all the obligations of a debtor. 
B) results in the loss of all the assets of a debtor. 
C) results in the repayment of debt within 3 to 5 years. 
D) exempts a debtor from all the tax payments and payments for alimony and child support. 
E) allows a debtor to retain some other personal assets as per federal regulations.

Question 17

Which of the following is the correct formula for calculating the debt safety ratio?

Accepted Answer

A) Total Monthly Consumer Credit Payments ÷ Monthly Take-Home Pay 
B) Monthly Take-Home Pay ÷ Total Monthly Consumer Credit Payments 
C) Total Monthly Consumer Credit Payments ÷ Gross Monthly Pay 
D) Gross Monthly Pay ÷ Total Monthly Consumer Credit Payments 
E) Gross Monthly Pay ÷ Monthly Take-Home Pay 
A) Total Monthly Consumer Credit Payments ÷ Monthly Take-Home Pay 
B) Monthly Take-Home Pay ÷ Total Monthly Consumer Credit Payments 
C) Total Monthly Consumer Credit Payments ÷ Gross Monthly Pay 
D) Gross Monthly Pay ÷ Total Monthly Consumer Credit Payments 
E) Gross Monthly Pay ÷ Monthly Take-Home Pay

Question 18

_____  involves some type of debt restructuring by establishing a debt repayment schedule.

Accepted Answer

A) The Wage Earner Plan 
B) Straight bankruptcy 
C) Pretexting 
D) Phishing 
E) Skimming 
A) The Wage Earner Plan 
B) Straight bankruptcy 
C) Pretexting 
D) Phishing 
E) Skimming

Question 19

A frequent flyer card can be aptly classified as a(n):

Accepted Answer

A) reward card. 
B) affinity card. 
C) retail charge card. 
D) cash advance. 
E) student card. 
A) reward card. 
B) affinity card. 
C) retail charge card. 
D) cash advance. 
E) student card.

Question 20

Which of the following does a lender look at before granting credit to an applicant?

Accepted Answer

A) The applicant's political interests 
B) The applicant's circle of friends 
C) The applicant's age 
D) The applicant's religious affiliations 
E) The applicant's career goals 
A) The applicant's political interests 
B) The applicant's circle of friends 
C) The applicant's age 
D) The applicant's religious affiliations 
E) The applicant's career goals

You should review your credit bureau file every year.

Which of the following cards provides direct access to your checking account?

Which of the following is usually excluded from a monthly credit card statement?

The decision about whether or not to grant you credit will be made by:

Which of the following statements about the cash advances that the holder of a bank credit card can obtain from participating banks is true?

Sheldon has a home valued at $108,000 with an outstanding mortgage of $70,000. If his lender is willing to provide a home equity loan of up to 80% of the market value of his home, how much can Sheldon borrow using a home equity loan?

The majority of persons filing for bankruptcy choose Chapter 7 of the U.S. Bankruptcy Code.

Your credit bureau file often includes information about your political and religious affiliations.

If the information in an individual borrower's credit report contains an error, he or she is entitled to:

If you are expecting difficulties in making your payments, it is recommended that you:

Which of the following is not requested in a typical credit card application?

For a fee, local credit bureaus can provide credit information to members about prospective borrowers in their community.

Credit offered in the form of _____ is most common in department and clothing stores and other high-volume outlets, where customers are likely to make several purchases each month.

William uses his bank credit card frequently; however, he always pays off the total outstanding balance on the card each month. What should William look for in a credit card given the way he uses one?

The market value of your house is $175,000, and you have a first mortgage balance of $100,000. If a lender requires an 80% loan-to-market value ratio, how large could your home equity loan be?

A straight bankruptcy:

Which of the following is the correct formula for calculating the debt safety ratio?

_____ involves some type of debt restructuring by establishing a debt repayment schedule.

A frequent flyer card can be aptly classified as a(n):

Which of the following does a lender look at before granting credit to an applicant?

Understanding the Financial Process

Using Financial Statements and Budgets

Preparing Your Taxes

Managing Your Cash and Savings

Making Automobile and Housing Decisions

Using Consumer Loans

Insuring Your Life

Insuring Your Health

Protecting Your Property

Investment Planning

Investing in Stocks and Bonds

Investing in Mutual Funds, Etfs, and Real Estate

Planning for Retirement

Preserving Your Estate

Filters

Exam 6: Using Credit

You should review your credit bureau file every year.

Which of the following cards provides direct access to your checking account?

Which of the following is usually excluded from a monthly credit card statement?

The decision about whether or not to grant you credit will be made by:

Which of the following statements about the cash advances that the holder of a bank credit card can obtain from participating banks is true?

Sheldon has a home valued at $108,000 with an outstanding mortgage of $70,000. If his lender is willing to provide a home equity loan of up to 80% of the market value of his home, how much can Sheldon borrow using a home equity loan?

The majority of persons filing for bankruptcy choose Chapter 7 of the U.S. Bankruptcy Code.

Your credit bureau file often includes information about your political and religious affiliations.

If the information in an individual borrower's credit report contains an error, he or she is entitled to:

If you are expecting difficulties in making your payments, it is recommended that you:

Which of the following is not requested in a typical credit card application?

For a fee, local credit bureaus can provide credit information to members about prospective borrowers in their community.

Credit offered in the form of _____ is most common in department and clothing stores and other high-volume outlets, where customers are likely to make several purchases each month.

William uses his bank credit card frequently; however, he always pays off the total outstanding balance on the card each month. What should William look for in a credit card given the way he uses one?

The market value of your house is $175,000, and you have a first mortgage balance of $100,000. If a lender requires an 80% loan-to-market value ratio, how large could your home equity loan be?

A straight bankruptcy:

Which of the following is the correct formula for calculating the debt safety ratio?

_____ involves some type of debt restructuring by establishing a debt repayment schedule.

A frequent flyer card can be aptly classified as a(n):

Which of the following does a lender look at before granting credit to an applicant?

Understanding the Financial Process

Using Financial Statements and Budgets

Preparing Your Taxes

Managing Your Cash and Savings

Making Automobile and Housing Decisions

Using Consumer Loans

Insuring Your Life

Insuring Your Health

Protecting Your Property

Investment Planning

Investing in Stocks and Bonds

Investing in Mutual Funds, Etfs, and Real Estate

Planning for Retirement

Preserving Your Estate

Filters