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

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 APY on Monty's default or penalty rate?

Typically,an annual fee charge ranges from $10 to $100,but the American Express Centurion Card charges a ________ annual fee-and there's also a ________ initiation fee for the first year.

According to a Nellie Mae study,93 percent of graduate students would have liked more information on financial management topics before they started school and would like financial management education made available to them now.

Angela tried to use her Macy's credit card at Target but was unsuccessful because Target only accepts Target credit cards.

What can you do if you cannot pay your credit card bills?

What vital areas are typically evaluated in "scoring"?

Non-profit Credit Counselors should be avoided due to their high fees.

The ________ provides a single location for financial protection and oversight-and its mandate is to help consumers make better decisions.

When you find you cannot pay your credit card bills you must take action! Which option is advisable?

Compare and contrast the average,previous,and adjusted balance methods.

Nico likes to go shopping.Every time he goes to a new store,he fills out an application for a store credit card so that he can get a 20 percent discount on his purchases that day.Yesterday,when he was trying to buy a new car,the dealer turned down his credit request.Nico can't understand why,because he thought he had good credit.If you looked at his credit report,what is the most likely reason he was denied credit?

Using your credit cards for cash advances is a relatively cheap way to borrow money because you usually do not start paying interest until the next billing period.

A credit bureau is a private organization that maintains credit information on individuals,which it allows subscribers to access for a fee.

A single-purpose card is a credit card that can be used only at a specific company.

One of the unpleasant secrets about using your credit card for a cash advance is 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. -What is Bradley's minimum payment?

List the five benefits or advantages associated with credit cards.What are the two major disadvantages?

Changes to your credit card policies and rates are usually announced via "________";which are notices enclosed with your bill.

Assuming the APR on your credit card is 18% and your average daily balance this month was $10,000,what will your interest or finance charges for the month be?

The Truth In Lending Act requires that all consumer credit agreements disclose the ________ in bold print?