Exam 6: Using Credit Cards: The Role of Open Credit

The average daily balance method calculates interest payments based on the ending balance of the previous period.

For the average consumer there is usually a set limit on open or revolving credit accounts.

The process of mathematically evaluating your creditworthiness to obtain credit is called

According to the Bankcard Holders Association of America,about 95 percent of all bank card issuers use the

Jerome has three major credit cards and makes payments on them each month. He has had one of them for six years, another for three years, and the last for eleven months. Making just the minimum payment has become automatic at this point, and Jerome barely even looks at the statements. Jerome is beginning to think that his approach to credit may be faulty, and he wants to find out how to adjust it. He just applied for two additional credit cards. -Most likely,Jerome is

Credit cards issued in conjunction with particular charities or organizations,like the Sierra Club or the Humane Society,that send a portion of their annual fee or percentage of their purchases back to the sponsoring organization are known as

Jerome has three major credit cards and makes payments on them each month. He has had one of them for six years, another for three years, and the last for eleven months. Making just the minimum payment has become automatic at this point, and Jerome barely even looks at the statements. Jerome is beginning to think that his approach to credit may be faulty, and he wants to find out how to adjust it. He just applied for two additional credit cards. -What advice might you give to Jerome?

Jessica always thought the grace-period feature of her credit card was a wonderful idea because her charges were interest-free during the grace period.After taking Dr.Art Keown's personal finance course,she learned this startling truth about grace periods.

Mary is 38 years old and many of her friends have gotten into trouble using their credit cards to buy things they can't afford.She feels lucky that her grandmother told her that credit is dangerous and that she should always pay cash for everything.So far,Mary has never had credit in her name and even paid cash for her car.From a personal finance perspective,what advice would you give to Mary?

Credit card companies send out a whopping 6 billion credit card offers annually-roughly 60 offers per U.S.household!

Which of the following is the best strategy for controlling and managing your credit cards and open debt?

For the convenience credit card user the interest rate is

Your credit score is possibly the most important number that affects your life.How does your credit score affect you?

What type of a credit card is issued in partnership with a specific charity or organization,such as Mothers Against Drunk Driving (MADD),the National Rifle Association (NRA),or a college or university?

Roxanne has always maintained an excellent credit rating over the years.She has an annual income of $23,000,has lived at her current residence three years,and has worked at the same job for eight years.Susan works in a clerical position,has two credit cards and maintains two bank accounts.Which one of the following items of evaluation would Roxanne score the highest on?

Which of the five Cs of credit would your actual home be in relation to your mortgage?

Credit purchases made for personal needs like home mortgages or car loans are referred to as revolving credit.

List four ways to avoid credit card fraud.

Your credit card company is required to send you a notice 45 days before they can increase your interest rate,change certain fees (such as annual fees,cash-advance fees,and late fees),or make other significant changes to the terms of your card.

What rights would a college friend of yours have whose credit card application was denied?