Exam 6: Managing Your Financial Resources - Assessing, Managing, and Securing Your Credit

Which of the following is a typical example of an instalment loan?

If you were charged the maximum legal rate of interest on a $1000 loan for one year,the interest cost would be $60.

A poor credit history will appear on your credit report for

Using your credit card provides you free financing each month.

If a person obtains your credit card number by standing close enough to you to either see your credit card or hear you speak the number during a telephone call,he or she is

A 20 percent annual interest rate on a $10 000 loan amortized over five-years would result in interest charges of $10 000.

If you apply for a payday loan of $1000 from a financial institution for 10 days,you pay back $1150.What is the cost of financing this payday loan?

The loan contract identifies all but which of the following?

Over the past 10 years you have paid your mortgage principal down from $250 000 to ?$203 000 and your house has a market value went from $330 000 to $310 000.How much of a home equity line of credit could you receive if you applied now?

Incorporating the use of credit into your financial plan requires understanding the correct use of different types of loans.Compare and contrast the positive and negative effects that credit cards and personal,home equity,and student loans may have on the success and failure of your financial plan.

What monthly payment (to the nearest dollar)would Dieter need to make on a $10 000 loan with a nine percent interest rate compounded monthly and a three year maturity?

Tom needs a car to commute to work and has found a suitable Honda Civic from a dealer for $8000.He has $3000 saved for it and can afford a monthly payment up to $250.Which of the following is the best (lowest total cost)financing option for him?

Credit card use can be good for your financial plan if you have budgeted to pay the entire balance when the statement is due.

The greatest benefit of student loans is that the interest is tax deductible.

If you receive a phone call that seeks to verify or update personal information,you should

A credit card charges 18 percent annual interest and Frank has $750 due on the statement date.He is only able to make the minimum payment of $22.50.If the billing cycle is 30 days and the grace period is 20 days,and he pays the full balance at the next due date,how much interest would he owe?

Which of the following can be used by a creditor in deciding whether or not to grant credit?

Your credit card had balances of $800 for 13 days,$600 for 5 days,and $650 for 12 days.Assume an annual interest rate of 18 percent,30-day billing cycle and 20-day grace period.How much is the interest charge using the average daily balance method,if the credit card gets paid off five days after the statement due date?

Devon has owned a home for eight years.It was purchased for $289 000.She has a first mortgage of $156 500,a car lease with a buyout amount of $12 000,and credit card debt of $1989.How much of a home equity loan can be applied for if the house was recently appraised at $331 000?

Jacob needs to borrow $19 000 to purchase a car.If the interest rate is seven percent compounded monthly,which of the following is True when considering a five,seven or ten year term?