Question 1

If your debt-to-equity ratio is about ½,you have reached the upper limit of debt obligations.

Accepted Answer

A) True 
 B)False

Question 2

A line of credit is the maximum dollar amount of credit the lender has made available to you.

Accepted Answer

A) True 
 B)False

Question 3

The credit cardholders who pay off their balances in full each month are known as convenience users.

Accepted Answer

A) True 
 B)False

Question 4

Experts suggest that you spend no more than ____________ percent of your net income on credit purchases.

Accepted Answer

A)  10 
B)  20 
C)  30 
D)  40 
E)  50 
A)  10 
B)  20 
C)  30 
D)  40 
E)  50

Question 5

If your monthly net (after-tax)income is $1,500,what should be your maximum amount spent on credit payments?

Accepted Answer

A)  $200 
B)  $300 
C)  $400 
D)  $500 
E)  $600 
A)  $200 
B)  $300 
C)  $400 
D)  $500 
E)  $600

Question 6

The debt-payment-to-income ratio is calculated by dividing your total liabilities by your net worth.

Accepted Answer

A) True 
 B)False

Question 7

"Shopaholics" and young adults are most vulnerable to misusing credit.

Accepted Answer

A) True 
 B)False

Question 8

The debt-to-equity ratio is calculated by dividing your monthly debt payments (not including house payments)by your net worth.

Accepted Answer

A) True 
 B)False

Question 9

How do creditors determine your credit-worthiness?

Accepted Answer

Creditors determine credit wor

Question 10

By paying cash for a purchase,you

Accepted Answer

A)  forgo the opportunity to keep the cash in an interest-bearing account. 
B)  always get a cash discount. 
C)  can build a better credit rating. 
D)  get better personal service from store employees. 
E)  have a better selection of goods than if you use credit. 
A)  forgo the opportunity to keep the cash in an interest-bearing account. 
B)  always get a cash discount. 
C)  can build a better credit rating. 
D)  get better personal service from store employees. 
E)  have a better selection of goods than if you use credit.

Question 11

A lender requires a cosigner even when a borrower meets the lender's criteria for making a loan.

Accepted Answer

A) True 
 B)False

Question 12

Experts suggest that you spend no more than 20 percent of your net income on credit payments.(However,15 percent is much better.)

Accepted Answer

A) True 
 B)False

Question 13

A credit card cash withdrawal always incurs interest from the moment of withdrawal.

Accepted Answer

A) True 
 B)False

Question 14

How can you protect yourself against credit/debit card fraud?

Accepted Answer

Here are the ways to protect yourself fr

Question 15

The use of credit can provide up to a 45day "float."

Accepted Answer

A) True 
 B)False

Question 16

A home equity loan is based only on the amount you still owe on your mortgage.

Accepted Answer

A) True 
 B)False

Question 17

Which of these is not a true statement? To avoid online fraud,you should _________.

Accepted Answer

A)  keep your personal information private. 
B)  review your monthly bank and credit card statements. 
C)  give your password only to your internet service provider. 
D)  use a secure browser. 
E)  give payment information only to know known businesses. 
A)  keep your personal information private. 
B)  review your monthly bank and credit card statements. 
C)  give your password only to your internet service provider. 
D)  use a secure browser. 
E)  give payment information only to know known businesses.

Question 18

The best way to maintain your credit rating is to

Accepted Answer

A)  use credit sparingly. 
B)  pay cash for your purchases. 
C)  repay your debts on time. 
D)  declare a Chapter 7 bankruptcy. 
E)  use as many credit cards as you can. 
A)  use credit sparingly. 
B)  pay cash for your purchases. 
C)  repay your debts on time. 
D)  declare a Chapter 7 bankruptcy. 
E)  use as many credit cards as you can.

Question 19

The debt-to-equity ratio is calculated by dividing your total liabilities by your net worth.

Accepted Answer

A) True 
 B)False

Question 20

Interest is a periodic charge for the use of credit,or other finance charges.

Accepted Answer

A) True 
 B)False

If your debt-to-equity ratio is about ½,you have reached the upper limit of debt obligations.

A line of credit is the maximum dollar amount of credit the lender has made available to you.

The credit cardholders who pay off their balances in full each month are known as convenience users.

Experts suggest that you spend no more than ____________ percent of your net income on credit purchases.

If your monthly net (after-tax)income is $1,500,what should be your maximum amount spent on credit payments?

The debt-payment-to-income ratio is calculated by dividing your total liabilities by your net worth.

"Shopaholics" and young adults are most vulnerable to misusing credit.

The debt-to-equity ratio is calculated by dividing your monthly debt payments (not including house payments)by your net worth.

How do creditors determine your credit-worthiness?

By paying cash for a purchase,you

A lender requires a cosigner even when a borrower meets the lender's criteria for making a loan.

Experts suggest that you spend no more than 20 percent of your net income on credit payments.(However,15 percent is much better.)

A credit card cash withdrawal always incurs interest from the moment of withdrawal.

How can you protect yourself against credit/debit card fraud?

The use of credit can provide up to a 45day "float."

A home equity loan is based only on the amount you still owe on your mortgage.

Which of these is not a true statement? To avoid online fraud,you should _________.

The best way to maintain your credit rating is to

The debt-to-equity ratio is calculated by dividing your total liabilities by your net worth.

Interest is a periodic charge for the use of credit,or other finance charges.

Personal Financial Planning in Action

Money Management Skills

Taxes in Your Financial Plan

Financial Services: Savings Plans and Payment Accounts

Consumer Purchasing Strategies and Wise Buying of Motor Vehicles

Selecting and Financing Housing

Home and Automobile Insurance

Health and Disability Income Insurance

Financial Planning With Life Insurance

Investing Basics and Evaluating Bonds

Investing in Stocks

Investing in Mutual Funds

Starting Early: Retirement and Estate Planning

Daily Spending Diary

Filters

Exam 5: Consumer Credit: Advantages, Disadvantages, Sources, and Costs

If your debt-to-equity ratio is about ½,you have reached the upper limit of debt obligations.

A line of credit is the maximum dollar amount of credit the lender has made available to you.

The credit cardholders who pay off their balances in full each month are known as convenience users.

Experts suggest that you spend no more than ____________ percent of your net income on credit purchases.

If your monthly net (after-tax)income is $1,500,what should be your maximum amount spent on credit payments?

The debt-payment-to-income ratio is calculated by dividing your total liabilities by your net worth.

"Shopaholics" and young adults are most vulnerable to misusing credit.

The debt-to-equity ratio is calculated by dividing your monthly debt payments (not including house payments)by your net worth.

How do creditors determine your credit-worthiness?

By paying cash for a purchase,you

A lender requires a cosigner even when a borrower meets the lender's criteria for making a loan.

Experts suggest that you spend no more than 20 percent of your net income on credit payments.(However,15 percent is much better.)

A credit card cash withdrawal always incurs interest from the moment of withdrawal.

How can you protect yourself against credit/debit card fraud?

The use of credit can provide up to a 45day "float."

A home equity loan is based only on the amount you still owe on your mortgage.

Which of these is not a true statement? To avoid online fraud,you should _________.

The best way to maintain your credit rating is to

The debt-to-equity ratio is calculated by dividing your total liabilities by your net worth.

Interest is a periodic charge for the use of credit,or other finance charges.

Personal Financial Planning in Action

Money Management Skills

Taxes in Your Financial Plan

Financial Services: Savings Plans and Payment Accounts

Consumer Purchasing Strategies and Wise Buying of Motor Vehicles

Selecting and Financing Housing

Home and Automobile Insurance

Health and Disability Income Insurance

Financial Planning With Life Insurance

Investing Basics and Evaluating Bonds

Investing in Stocks

Investing in Mutual Funds

Starting Early: Retirement and Estate Planning

Daily Spending Diary

Filters