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

Taking a cash advance on your credit card for daily living expenses may not be a wise financial decision because interest begins on the cash advance balance amount immediately.

A convenience user of credit cards is someone who pays off the credit card balance each month.

What is the difference between voluntary and involuntary inquires?

Monty currently has a Visa card from his bank with the following terms: 18% on purchases, 24% on cash advances with a 4% cash advance fee on the amount, and a default or penalty rate of 36%. His current statement shows a balance of $6,000. So far he has only taken one cash advance, withdrawing $1,000 from a casino in Las Vegas a year ago, which he has already paid off. Lately he has been having a hard time paying more than the minimum payment of 4% of his balance. The only assets he owns are a seven-year-old car and a $2,500 certificate of deposit that has a 5% APR. -What is the current APY on this credit card?

One of the five C's of credit is capacity.Most likely,what information would potential creditors consider in evaluating your capacity?

The ________ is the interest rate you pay on your balance if you don't make your minimum payments on time.

The Fair and Accurate Credit Transactions Act (FACT)allows everyone to a free copy of their credit report every year.Why is it a good idea to check your credit report every year?

When you use a credit card at a store,the store is generally charged a fee ranging from 1.5% to 5%.What is this fee called?

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

Research has determined that undergraduate college students tend to behave in similar manners with regards to their credit card usage.As noted in Chapter 6,which of the following behaviors are indicative of undergraduate students' credit card behaviors?

Your credit card company is required to send you a notice ________ 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.

The Consumer Financial Protection Bureau was created with the oversight authority necessary to ensure that

Bradley currently has a Visa card from his bank with the following terms: 21 percent on purchases, 25 percent on cash advances with a 3 percent cash-advance fee on the amount, and a default or penalty rate of 33 percent. His current statement shows a balance of $9,000. Lately, he has been having a hard time paying more than the minimum payment of 3 percent of his balance. -If Bradley buys a new game console for $560 this month and sends in a credit card payment of $950 when he gets his statement,how much interest will he pay on the game console for the month?

Assume a 31-day month to calculate your average daily balance for your credit card bill.Your daily balance for the first 10 days was $1,400,for the next 10 days was $1900,and for the last 10 days was $2700.What will your average daily balance be at the end of the month?

What is the main distinguishing feature(s)for T&E cards?

Josh was sued by his former business partner.He lost the case and has to pay his former partner $10,000.He has not yet done so and is refusing to do so.Josh is applying for a mortgage for a new home.Should he be worried about the lawsuit impacting his mortgage application?

More than ________ of the 25 biggest credit card issuers do not charge annual fees.

Only a Credit Repair company can remove inaccurate data from your credit report.

Which of the following is not a single-purpose credit card?

Describe four ways to prevent identity theft.