Question 1

A large number of credit inquiries means

Accepted Answer

A) you have a high BEACON score. 
B) you are seeking credit from several institutions. 
C) you have a good rating with many financial institutions. 
D) you are very diligent on tracking your credit information. 
A) you have a high BEACON score. 
B) you are seeking credit from several institutions. 
C) you have a good rating with many financial institutions. 
D) you are very diligent on tracking your credit information.

Question 2

You have the cash available to pay off a $6500 loan that will cost you $450 in interest this year and you are deciding whether to pay it off or make an investment. If you are in a 30 percent tax bracket, how much interest would you have to earn to make the investment a better decision?

Accepted Answer

A) More than $450. 
B) More than $580. 
C) The investment should have a return of 8 percent. 
D) The loan rate is 6.9 percent, so the investment should earn a better rate. 
A) More than $450. 
B) More than $580. 
C) The investment should have a return of 8 percent. 
D) The loan rate is 6.9 percent, so the investment should earn a better rate.

Question 3

Use of Financial Calculator TI BA-Plus required. Your credit card balance was $900 and you made a $500 payment. What would be the finance charge at 2 percent monthly if your company used the previous balance method?

Accepted Answer

A) $18 
B) $8 
C) $10 
D) Insufficient information 
A) $18 
B) $8 
C) $10 
D) Insufficient information

Question 4

When applying for a credit card, you will be asked to provide the following information except

Accepted Answer

A) monthly income. 
B) expenses. 
C) credit history. 
D) tax refund. 
A) monthly income. 
B) expenses. 
C) credit history. 
D) tax refund.

Question 5

If you had a major payment problem with your credit card in 2009, you expect that a credit report will still highlight this problem

Accepted Answer

A) up to 2013. 
B) up to 2014. 
C) up to 2015. 
D) up to 2016. 
A) up to 2013. 
B) up to 2014. 
C) up to 2015. 
D) up to 2016.

Question 6

The item that receives the most weight in the BEACON credit scoring system is

Accepted Answer

A) the amount of credit used each month. 
B) credit payment history. 
C) credit use. 
D) debt to equity ratio. 
A) the amount of credit used each month. 
B) credit payment history. 
C) credit use. 
D) debt to equity ratio.

Question 7

Which BEACON score is the lowest that would normally gain you easy approval for credit?

Accepted Answer

A) 300 
B) 500 
C) 700 
D) 900 
A) 300 
B) 500 
C) 700 
D) 900

Question 8

Revolving credit means

Accepted Answer

A) the loan balance will fluctuate based on the amount used from time to time. 
B) the interest rate will revolve above the prime rate. 
C) payments against the loan balance will always be the same amount. 
D) the loan has a final maturity date. 
A) the loan balance will fluctuate based on the amount used from time to time. 
B) the interest rate will revolve above the prime rate. 
C) payments against the loan balance will always be the same amount. 
D) the loan has a final maturity date.

Question 9

A credit card charges 18 percent annual interest and you have a balance due on the statement date of $750. You are able to make only the minimum payment of $18. What will be the interest charge for the next 30 days assuming the credit card uses the previous balance method?

Accepted Answer

A) $11.10 
B) $13.50 
C) $10.83 
D) $12.92 
A) $11.10 
B) $13.50 
C) $10.83 
D) $12.92

Question 10

A credit card usually gives a "grace period" during which you are not charged any interest on your purchase for

Accepted Answer

A) 15 days. 
B) 20 days. 
C) 25 days. 
D) 30 days. 
A) 15 days. 
B) 20 days. 
C) 25 days. 
D) 30 days.

Question 11

Revolving open-end credit means that credit will be provided up to a specified maximum and

Accepted Answer

A) interest is charged each month on the outstanding balance. 
B) the consumer has to pay the entire amount borrowed each month. 
C) interest is charged each month on the specified maximum amount. 
D) the consumer must pay interest and three percent of principal each month. 
A) interest is charged each month on the outstanding balance. 
B) the consumer has to pay the entire amount borrowed each month. 
C) interest is charged each month on the specified maximum amount. 
D) the consumer must pay interest and three percent of principal each month.

Question 12

You can begin to build a credit history by applying for a credit card.

Accepted Answer

A) True 
 B)False

Question 13

Explain how use of a credit card can affect the successful implementation of a financial plan. Note that you will be able to find both constructive and damaging uses of credit cards in the financial planning process.

Accepted Answer

Supplement cash flow in times of need.
M

Question 14

Errors on credit reports can occur. If there is an error on your report,

Accepted Answer

A) it is your responsibility to review it once a year for accuracy and inform about any errors. 
B) your dispute will result in the credit agency being charged under the Fair Credit Reporting Act. 
C) the creditor reporting to the agency must correct it at your request. 
D) you must inform the Better Business Bureau to take your case to the authorities. 
A) it is your responsibility to review it once a year for accuracy and inform about any errors. 
B) your dispute will result in the credit agency being charged under the Fair Credit Reporting Act. 
C) the creditor reporting to the agency must correct it at your request. 
D) you must inform the Better Business Bureau to take your case to the authorities.

Question 15

Which of the following statements is true regarding a review of your credit agency report?

Accepted Answer

A) You will not have authority to make corrections, as the information must come from a financial institution. 
B) It will help determine if there are credit cards you should apply for to improve your credit standing. 
C) It will reveal if you have sufficient income to carry the new debt payments. 
D) It will reveal deficiencies that you can work on to improve your credit rating. 
A) You will not have authority to make corrections, as the information must come from a financial institution. 
B) It will help determine if there are credit cards you should apply for to improve your credit standing. 
C) It will reveal if you have sufficient income to carry the new debt payments. 
D) It will reveal deficiencies that you can work on to improve your credit rating.

Question 16

Creditor insurance

Accepted Answer

A) is a free benefit on most credit cards. 
B) can be used to pay off all debt when a creditor becomes unemployed. 
C) is a good substitute for health and disability insurance. 
D) can cover monthly credit repayments if a consumer cannot work. 
A) is a free benefit on most credit cards. 
B) can be used to pay off all debt when a creditor becomes unemployed. 
C) is a good substitute for health and disability insurance. 
D) can cover monthly credit repayments if a consumer cannot work.

Question 17

Shredding documents or statements might be a way to help prevent identity theft.

Accepted Answer

A) True 
 B)False

Question 18

Paying an annual membership fee to a credit company is a good idea

Accepted Answer

A) because it will likely be a prestige card. 
B) if it includes benefits that are worth the fee. 
C) for the creditor who wishes to carry a balance on the card. 
D) because these cards always improve your credit score. 
A) because it will likely be a prestige card. 
B) if it includes benefits that are worth the fee. 
C) for the creditor who wishes to carry a balance on the card. 
D) because these cards always improve your credit score.

Question 19

Contacting the credit bureau to notify them of identity theft is not necessary.

Accepted Answer

A) True 
 B)False

Question 20

Your credit score is calculated using

Accepted Answer

A) your credit payment history. 
B) your income history. 
C) your cash flow. 
D) all of the above. 
A) your credit payment history. 
B) your income history. 
C) your cash flow. 
D) all of the above.

A large number of credit inquiries means

You have the cash available to pay off a $6500 loan that will cost you $450 in interest this year and you are deciding whether to pay it off or make an investment. If you are in a 30 percent tax bracket, how much interest would you have to earn to make the investment a better decision?

Use of Financial Calculator TI BA-Plus required. Your credit card balance was $900 and you made a $500 payment. What would be the finance charge at 2 percent monthly if your company used the previous balance method?

When applying for a credit card, you will be asked to provide the following information except

If you had a major payment problem with your credit card in 2009, you expect that a credit report will still highlight this problem

The item that receives the most weight in the BEACON credit scoring system is

Which BEACON score is the lowest that would normally gain you easy approval for credit?

Revolving credit means

A credit card charges 18 percent annual interest and you have a balance due on the statement date of $750. You are able to make only the minimum payment of $18. What will be the interest charge for the next 30 days assuming the credit card uses the previous balance method?

A credit card usually gives a "grace period" during which you are not charged any interest on your purchase for

Revolving open-end credit means that credit will be provided up to a specified maximum and

You can begin to build a credit history by applying for a credit card.

Explain how use of a credit card can affect the successful implementation of a financial plan. Note that you will be able to find both constructive and damaging uses of credit cards in the financial planning process.

Errors on credit reports can occur. If there is an error on your report,

Which of the following statements is true regarding a review of your credit agency report?

Creditor insurance

Shredding documents or statements might be a way to help prevent identity theft.

Paying an annual membership fee to a credit company is a good idea

Contacting the credit bureau to notify them of identity theft is not necessary.

Your credit score is calculated using

Overview of a Financial Plan

Tools for Financial Planning - Applying Time Value Concepts

Tools for Financial Planning - Planning With Personal Financial Statements

Tools for Financial Planning - Using Tax Concepts for Planning

Banking Services and Managing Your Money

Personal Financing - Personal Loans

Personal Financing - Purchasing and Financing a Home

Protecting Your Wealth - Auto and Homeowners Insurance

Protecting Your Wealth - Health and Life Insurance

Personal Investing - Investing Fundamentals

Personal Investing - Investing in Stocks

Personal Investing - Investing in Bonds

Personal Investing - Investing in Mutual Funds

Retirement and Estate Planning - Retirement Planning

Retirement and Estate Planning - Estate Planning

Synthesis of Financial Planning - Integrating the Components of a Financial Plan

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Exam 6: Managing Your Liquidity - Assessing, Managing, and Securing Your Credit

A large number of credit inquiries means

You have the cash available to pay off a $6500 loan that will cost you $450 in interest this year and you are deciding whether to pay it off or make an investment. If you are in a 30 percent tax bracket, how much interest would you have to earn to make the investment a better decision?

Use of Financial Calculator TI BA-Plus required. Your credit card balance was $900 and you made a $500 payment. What would be the finance charge at 2 percent monthly if your company used the previous balance method?

When applying for a credit card, you will be asked to provide the following information except

If you had a major payment problem with your credit card in 2009, you expect that a credit report will still highlight this problem

The item that receives the most weight in the BEACON credit scoring system is

Which BEACON score is the lowest that would normally gain you easy approval for credit?

Revolving credit means

A credit card charges 18 percent annual interest and you have a balance due on the statement date of $750. You are able to make only the minimum payment of $18. What will be the interest charge for the next 30 days assuming the credit card uses the previous balance method?

A credit card usually gives a "grace period" during which you are not charged any interest on your purchase for

Revolving open-end credit means that credit will be provided up to a specified maximum and

You can begin to build a credit history by applying for a credit card.

Explain how use of a credit card can affect the successful implementation of a financial plan. Note that you will be able to find both constructive and damaging uses of credit cards in the financial planning process.

Errors on credit reports can occur. If there is an error on your report,

Which of the following statements is true regarding a review of your credit agency report?

Creditor insurance

Shredding documents or statements might be a way to help prevent identity theft.

Paying an annual membership fee to a credit company is a good idea

Contacting the credit bureau to notify them of identity theft is not necessary.

Your credit score is calculated using

Overview of a Financial Plan

Tools for Financial Planning - Applying Time Value Concepts

Tools for Financial Planning - Planning With Personal Financial Statements

Tools for Financial Planning - Using Tax Concepts for Planning

Banking Services and Managing Your Money

Personal Financing - Personal Loans

Personal Financing - Purchasing and Financing a Home

Protecting Your Wealth - Auto and Homeowners Insurance

Protecting Your Wealth - Health and Life Insurance

Personal Investing - Investing Fundamentals

Personal Investing - Investing in Stocks

Personal Investing - Investing in Bonds

Personal Investing - Investing in Mutual Funds

Retirement and Estate Planning - Retirement Planning

Retirement and Estate Planning - Estate Planning

Synthesis of Financial Planning - Integrating the Components of a Financial Plan

Filters