Question 1

Buying on credit is almost always cheaper than paying cash.

Accepted Answer

A) True 
 B)False  False

Question 2

If you borrow $100 at 10 percent interest,how much will you repay in one lump-sum at the end of one year using simple interest?

Accepted Answer

A) $100. 
B) $105. 
C) $110. 
D) $115. 
E) $120 
A) $100. 
B) $105. 
C) $110. 
D) $115. 
E) $120 C

Question 3

Gary Simpson notices that his neighbor has a brand new Ford F150 truck parked in the driveway.Even though his current car is fine,Gary decides that he needs a new car and goes out and purchases a Tundra with a six-year loan.Which one of the following bestexplains Gary's spending,which can lead to overindebtedness?

Accepted Answer

A) Misunderstanding or lack of communication 
B) The use of money to punish 
C) The expectation of instant comfort 
D) Keeping up with the Joneses 
E) Overindulgence of children 
A) Misunderstanding or lack of communication 
B) The use of money to punish 
C) The expectation of instant comfort 
D) Keeping up with the Joneses 
E) Overindulgence of children D

Question 4

In open-end credit,what are the various systems creditors use to calculate the balance on which they assess finance charges?

Accepted Answer

Creditors use the following me

Question 5

If you find that you cannot make your payments,the first thing you should do is:

Accepted Answer

A) skip town. 
B) declare personal bankruptcy. 
C) borrow from a loan shark to make the payment. 
D) let the borrower go to a collection agency. 
E) contact your creditors and try to work out a modified payment plan with them. 
A) skip town. 
B) declare personal bankruptcy. 
C) borrow from a loan shark to make the payment. 
D) let the borrower go to a collection agency. 
E) contact your creditors and try to work out a modified payment plan with them.

Question 6

This morning,you received a phone call alleging you owe a debt.If you dispute this debt,you must write to the debt collector and request verification of the obligation.How many days do you have to send this letter?

Accepted Answer

A) 5 
B) 10 
C) 15 
D) 20 
E) 30 
A) 5 
B) 10 
C) 15 
D) 20 
E) 30

Question 7

Which method of payment is almost always cheaper than using credit?

Accepted Answer

A) Bank credit card 
B) Check written on a home equity line of credit 
C) Cash 
D) Store credit card 
E) Cash advance on a Visa credit card 
A) Bank credit card 
B) Check written on a home equity line of credit 
C) Cash 
D) Store credit card 
E) Cash advance on a Visa credit card

Question 8

What are two key concepts to remember if you are thinking of borrowing money or opening a credit account?

Accepted Answer

Two key concepts are the finance charge

Question 9

The CCCS aids families by:

Accepted Answer

A) setting up a realistic budget for them. 
B) paying off their loans. 
C) providing free basic necessities. 
D) providing one month free shelter. 
E) relocating them in less expensive areas. 
A) setting up a realistic budget for them. 
B) paying off their loans. 
C) providing free basic necessities. 
D) providing one month free shelter. 
E) relocating them in less expensive areas.

Question 10

An increasing number of bankruptcy filers are well-educated,middle-class baby boomers.

Accepted Answer

A) True 
 B)False

Question 11

Chuck Stallings qualifies for an American Express card.Which of the following offers this type of loan?

Accepted Answer

A) Credit union 
B) Payday advance company 
C) Finance company 
D) T&E card 
E) Commercial bank 
A) Credit union 
B) Payday advance company 
C) Finance company 
D) T&E card 
E) Commercial bank

Question 12

The most commonly purchased type of credit insurance is:

Accepted Answer

A) credit life insurance. 
B) credit accident insurance. 
C) credit health insurance. 
D) credit property insurance. 
E) credit disability insurance. 
A) credit life insurance. 
B) credit accident insurance. 
C) credit health insurance. 
D) credit property insurance. 
E) credit disability insurance.

Question 13

The Consumer Credit Counseling Service counseling is usually free.

Accepted Answer

A) True 
 B)False

Question 14

Excessive indebtedness can result in:

Accepted Answer

A) heavy drinking. 
B) a neglect of children. 
C) marital difficulties. 
D) drug abuse. 
E) All of these. 
A) heavy drinking. 
B) a neglect of children. 
C) marital difficulties. 
D) drug abuse. 
E) All of these.

Question 15

If you declare a Chapter 7 bankruptcy,you do not have to pay alimony,child support,or educational loans.

Accepted Answer

A) True 
 B)False

Question 16

Explain simple interest.

Accepted Answer

Simple interest is the interest computed

Question 17

In a Chapter 7 bankruptcy,the debtor:

Accepted Answer

A) is required to draw up a petition listing his or her assets and liabilities. 
B) does not have to pay a filing fee. 
C) is called a "bankrupt." 
D) does not have to pay outstanding alimony and child support payments. 
E) does not have to repay educational loans. 
A) is required to draw up a petition listing his or her assets and liabilities. 
B) does not have to pay a filing fee. 
C) is called a "bankrupt." 
D) does not have to pay outstanding alimony and child support payments. 
E) does not have to repay educational loans.

Question 18

A few months ago,you sent a certified letter to a debt collector and requested verification of a debt the collector says you owe.You know the letter was received by the collector but you have not received a response to your request.Today,you received a letterthreatening court action.What should you do?

Accepted Answer

A) Pay the debt and protect your credit rating 
B) Insist that communications about the debt cease 
C) Renegotiate payment terms with the creditor 
D) Sue the collection agency 
E) Pay half the outstanding balance 
A) Pay the debt and protect your credit rating 
B) Insist that communications about the debt cease 
C) Renegotiate payment terms with the creditor 
D) Sue the collection agency 
E) Pay half the outstanding balance

Question 19

Jeff Bloom wants to have a house just like the one his parents had when he was a teenager.He finds the house he wants and gets an interest-only loan on it for the first five years.Which one of the following best explains Jeff's spending,which can lead to overindebtedness?

Accepted Answer

A) Misunderstanding or lack of communication 
B) The use of money to punish 
C) The expectation of instant comfort 
D) Keeping up with the Joneses 
E) Overindulgence of children 
A) Misunderstanding or lack of communication 
B) The use of money to punish 
C) The expectation of instant comfort 
D) Keeping up with the Joneses 
E) Overindulgence of children

Question 20

Sarah Parker's husband goes out with the 'boys' for a night on the town and gets home at 4 am waking everyone in the house.In response,Sarah goes out the next day and spends $500 in new clothes for herself putting it all on her credit card.Which one of thefollowing best explains Sarah's spending,which can cause overindebtedness?

Accepted Answer

A) Misunderstanding or lack of communication 
B) The use of money to punish 
C) The expectation of instant comfort 
D) Keeping up with the Joneses 
E) Overindulgence of children 
A) Misunderstanding or lack of communication 
B) The use of money to punish 
C) The expectation of instant comfort 
D) Keeping up with the Joneses 
E) Overindulgence of children

Buying on credit is almost always cheaper than paying cash.

If you borrow $100 at 10 percent interest,how much will you repay in one lump-sum at the end of one year using simple interest?

In open-end credit,what are the various systems creditors use to calculate the balance on which they assess finance charges?

If you find that you cannot make your payments,the first thing you should do is:

This morning,you received a phone call alleging you owe a debt.If you dispute this debt,you must write to the debt collector and request verification of the obligation.How many days do you have to send this letter?

Which method of payment is almost always cheaper than using credit?

What are two key concepts to remember if you are thinking of borrowing money or opening a credit account?

The CCCS aids families by:

An increasing number of bankruptcy filers are well-educated,middle-class baby boomers.

Chuck Stallings qualifies for an American Express card.Which of the following offers this type of loan?

The most commonly purchased type of credit insurance is:

The Consumer Credit Counseling Service counseling is usually free.

Excessive indebtedness can result in:

If you declare a Chapter 7 bankruptcy,you do not have to pay alimony,child support,or educational loans.

Explain simple interest.

In a Chapter 7 bankruptcy,the debtor:

Jeff Bloom wants to have a house just like the one his parents had when he was a teenager.He finds the house he wants and gets an interest-only loan on it for the first five years.Which one of the following best explains Jeff's spending,which can lead to overindebtedness?

Personal Finance Basics and the Time Value of Money

Financial Aspects of Career Planning

Money Management Strategy: Financial Statements and Budgeting

Planning Your Tax Strategy

Financial Services: Savings Plans and Payment Accounts

Introduction to Consumer Credit

Consumer Purchasing Strategies and Legal Protection

The Housing Decision: Factors and Finances

Property and Motor Vehicle Insurance

Health, Disability, and Long-Term Care Insurance

Life Insurance

Investing Fundamentals

Investing in Stock

Investing in Bonds

Investing in Mutual Funds

Investing in Real Estate and Other Investment Alternatives

Starting Early: Retirement Planning

Estate Planning

Filters

Exam 7: Choosing a Source of Credit: The Costs of Credit Alternatives

Buying on credit is almost always cheaper than paying cash.

If you borrow $100 at 10 percent interest,how much will you repay in one lump-sum at the end of one year using simple interest?

In open-end credit,what are the various systems creditors use to calculate the balance on which they assess finance charges?

If you find that you cannot make your payments,the first thing you should do is:

This morning,you received a phone call alleging you owe a debt.If you dispute this debt,you must write to the debt collector and request verification of the obligation.How many days do you have to send this letter?

Which method of payment is almost always cheaper than using credit?

What are two key concepts to remember if you are thinking of borrowing money or opening a credit account?

The CCCS aids families by:

An increasing number of bankruptcy filers are well-educated,middle-class baby boomers.

Chuck Stallings qualifies for an American Express card.Which of the following offers this type of loan?

The most commonly purchased type of credit insurance is:

The Consumer Credit Counseling Service counseling is usually free.

Excessive indebtedness can result in:

If you declare a Chapter 7 bankruptcy,you do not have to pay alimony,child support,or educational loans.

Explain simple interest.

In a Chapter 7 bankruptcy,the debtor:

Jeff Bloom wants to have a house just like the one his parents had when he was a teenager.He finds the house he wants and gets an interest-only loan on it for the first five years.Which one of the following best explains Jeff's spending,which can lead to overindebtedness?

Personal Finance Basics and the Time Value of Money

Financial Aspects of Career Planning

Money Management Strategy: Financial Statements and Budgeting

Planning Your Tax Strategy

Financial Services: Savings Plans and Payment Accounts

Introduction to Consumer Credit

Consumer Purchasing Strategies and Legal Protection

The Housing Decision: Factors and Finances

Property and Motor Vehicle Insurance

Health, Disability, and Long-Term Care Insurance

Life Insurance

Investing Fundamentals

Investing in Stock

Investing in Bonds

Investing in Mutual Funds

Investing in Real Estate and Other Investment Alternatives

Starting Early: Retirement Planning

Estate Planning

Filters