Question 1

_____ would be a proper use of credit.

Accepted Answer

A)  Purchase of a house 
B)  A financial emergency 
C)  Shopping convenience 
D)  Investing 
E)  All of these 
A)  Purchase of a house 
B)  A financial emergency 
C)  Shopping convenience 
D)  Investing 
E)  All of these

Question 2

Your credit limit is determined by a number of factors,such as financial position,earning power,etc.

Accepted Answer

A) True 
 B)False

Question 3

You have a $926 balance on your credit card account.The annual percentage rate (APR)on the account is 18%.Assuming the balance of $926 does not include any interest charge,what will be the minimum payment that will cover interest expenses?

Accepted Answer

$926 × 0.18 ÷ 12 = $

Question 4

Joe and Jane have a tendency to build up large balances on their credit cards.Which of the following would be least important for them?

Accepted Answer

A)  No annual fee 
B)  Low interest rates on balances 
C)  Long grace period 
D)  Method of calculating balances 
E)  a and b 
A)  No annual fee 
B)  Low interest rates on balances 
C)  Long grace period 
D)  Method of calculating balances 
E)  a and b

Question 5

Identity theft is a growing problem that could damage your credit rating.

Accepted Answer

A) True 
 B)False

Question 6

If your monthly before-tax income is $2,000 and your monthly take-home pay is $1,500,your maximum monthly consumer credit payments should not exceed:

Accepted Answer

A)  $600. 
B)  $450. 
C)  $400. 
D)  $300. 
E)  $200. 
A)  $600. 
B)  $450. 
C)  $400. 
D)  $300. 
E)  $200.

Question 7

Choose the word or phrase in [ ] which will correctly complete the statement.Select "a" for the first item,"b" for the second item,and "c" if neither item will correctly complete the statement.
-Nancy's take-home income is $3,000 per month,and she currently has $700 monthly consumer debt.According to the general rules of thumb,Nancy [is | is not] in a position to take on additional consumer debt.

Accepted Answer

The answer of Choose the word or phrase in [...

Question 8

Choose the word or phrase in [ ] which will correctly complete the statement.Select "a" for the first item,"b" for the second item,and "c" if neither item will correctly complete the statement.
-An example of open account credit would be a bank [debit | credit] card.

Accepted Answer

The answer of Choose the word or phrase in [...

Question 9

Credit cards with very low minimum payment requirements are in the consumer's best interest.

Accepted Answer

A) True 
 B)False

Question 10

Paying only the minimum payment each time on a credit card usually enables one to pay off the balance fairly quickly.

Accepted Answer

A) True 
 B)False

Question 11

William uses his bank credit card frequently; however,he always pays off the total balance on the card each month.What should William look for in a credit card given the way he uses a credit card?

Accepted Answer

A)  Low annual fee and short grace period 
B)  Low annual fee and low interest rate 
C)  No annual fee and short grace period 
D)  No annual fee and long grace period 
E)  High annual fee and low interest rate 
A)  Low annual fee and short grace period 
B)  Low annual fee and low interest rate 
C)  No annual fee and short grace period 
D)  No annual fee and long grace period 
E)  High annual fee and low interest rate

Question 12

Choose the word or phrase in [ ] which will correctly complete the statement.Select "a" for the first item,"b" for the second item,and "c" if neither item will correctly complete the statement.
-The first step to take in establishing a credit history is to [get a credit card | open checking and savings accounts].

Accepted Answer

The answer of Choose the word or phrase in [...

Question 13

Choose the word or phrase in [ ] which will correctly complete the statement.Select "a" for the first item,"b" for the second item,and "c" if neither item will correctly complete the statement.
-Discount store and online sales have [decreased | increased] as consumers look for more bargains.

Accepted Answer

The answer of Choose the word or phrase in [...

Question 14

Paying a loan ahead of schedule is one way to build a good credit rating.

Accepted Answer

A) True 
 B)False

Question 15

The _____ is a second mortgage on your home.

Accepted Answer

A)  affinity card 
B)  unsecured personal credit line 
C)  home equity line of credit 
D)  preferred Visa card 
E)  platinum American Express card 
A)  affinity card 
B)  unsecured personal credit line 
C)  home equity line of credit 
D)  preferred Visa card 
E)  platinum American Express card

Question 16

The following are methods used to obtain personal information for identity theft except:

Accepted Answer

A)  lost or stolen wallet/credit card. 
B)  family,friends,acquaintances. 
C)  corrupt employees. 
D)  stolen mail. 
E)  all the above are methods used 
A)  lost or stolen wallet/credit card. 
B)  family,friends,acquaintances. 
C)  corrupt employees. 
D)  stolen mail. 
E)  all the above are methods used

Question 17

Mike has a MasterCard with an annual fee of $25,18% interest,and a $1,000 credit limit.He always pays the total outstanding balance monthly.His most recent monthly statement lists last month's payment,new charges this month totaling $1,500,and a $30 fee.That fee is most likely the result of:

Accepted Answer

A)  interest charges. 
B)  his annual fee. 
C)  an over-the-limit fee. 
D)  a late payment. 
E)  transaction fees on purchases. 
A)  interest charges. 
B)  his annual fee. 
C)  an over-the-limit fee. 
D)  a late payment. 
E)  transaction fees on purchases.

Question 18

One can be overusing credit even though he can afford to make minimum monthly payments on time.

Accepted Answer

A) True 
 B)False

Question 19

Bank credit cards represent the most common kind of open account credit.

Accepted Answer

A) True 
 B)False

Question 20

Chapter 7 bankruptcies remain in your credit file for 12 years.

Accepted Answer

A) True 
 B)False

_____ would be a proper use of credit.

Your credit limit is determined by a number of factors,such as financial position,earning power,etc.

You have a $926 balance on your credit card account.The annual percentage rate (APR)on the account is 18%.Assuming the balance of $926 does not include any interest charge,what will be the minimum payment that will cover interest expenses?

Joe and Jane have a tendency to build up large balances on their credit cards.Which of the following would be least important for them?

Identity theft is a growing problem that could damage your credit rating.

If your monthly before-tax income is $2,000 and your monthly take-home pay is $1,500,your maximum monthly consumer credit payments should not exceed:

Choose the word or phrase in [ ] which will correctly complete the statement.Select "a" for the first item,"b" for the second item,and "c" if neither item will correctly complete the statement. -An example of open account credit would be a bank [debit | credit] card.

Credit cards with very low minimum payment requirements are in the consumer's best interest.

Paying only the minimum payment each time on a credit card usually enables one to pay off the balance fairly quickly.

William uses his bank credit card frequently; however,he always pays off the total balance on the card each month.What should William look for in a credit card given the way he uses a credit card?

Choose the word or phrase in [ ] which will correctly complete the statement.Select "a" for the first item,"b" for the second item,and "c" if neither item will correctly complete the statement. -Discount store and online sales have [decreased | increased] as consumers look for more bargains.

Paying a loan ahead of schedule is one way to build a good credit rating.

The _____ is a second mortgage on your home.

The following are methods used to obtain personal information for identity theft except:

Mike has a MasterCard with an annual fee of $25,18% interest,and a $1,000 credit limit.He always pays the total outstanding balance monthly.His most recent monthly statement lists last month's payment,new charges this month totaling $1,500,and a $30 fee.That fee is most likely the result of:

One can be overusing credit even though he can afford to make minimum monthly payments on time.

Bank credit cards represent the most common kind of open account credit.

Chapter 7 bankruptcies remain in your credit file for 12 years.

Understanding the Financial Planning Process

Using Financial Statements and Budgets

Preparing Your Taxes

Managing Your Cash and Savings

Making Automobile and Housing Decisions

Using Consumer Loans

Insuring Your Life

Insuring Your Health

Protecting Your Property

Investment Planning

Investing in Stocks and Bonds

Investing in Mutual Funds

Planning for Retirement

Preserving Your Estate

Filters

Exam 6: Using Credit

_____ would be a proper use of credit.

Your credit limit is determined by a number of factors,such as financial position,earning power,etc.

You have a $926 balance on your credit card account.The annual percentage rate (APR)on the account is 18%.Assuming the balance of $926 does not include any interest charge,what will be the minimum payment that will cover interest expenses?

Joe and Jane have a tendency to build up large balances on their credit cards.Which of the following would be least important for them?

Identity theft is a growing problem that could damage your credit rating.

If your monthly before-tax income is $2,000 and your monthly take-home pay is $1,500,your maximum monthly consumer credit payments should not exceed:

Choose the word or phrase in [ ] which will correctly complete the statement.Select "a" for the first item,"b" for the second item,and "c" if neither item will correctly complete the statement. -An example of open account credit would be a bank [debit | credit] card.

Credit cards with very low minimum payment requirements are in the consumer's best interest.

Paying only the minimum payment each time on a credit card usually enables one to pay off the balance fairly quickly.

William uses his bank credit card frequently; however,he always pays off the total balance on the card each month.What should William look for in a credit card given the way he uses a credit card?

Choose the word or phrase in [ ] which will correctly complete the statement.Select "a" for the first item,"b" for the second item,and "c" if neither item will correctly complete the statement. -Discount store and online sales have [decreased | increased] as consumers look for more bargains.

Paying a loan ahead of schedule is one way to build a good credit rating.

The _____ is a second mortgage on your home.

The following are methods used to obtain personal information for identity theft except:

Mike has a MasterCard with an annual fee of $25,18% interest,and a $1,000 credit limit.He always pays the total outstanding balance monthly.His most recent monthly statement lists last month's payment,new charges this month totaling $1,500,and a $30 fee.That fee is most likely the result of:

One can be overusing credit even though he can afford to make minimum monthly payments on time.

Bank credit cards represent the most common kind of open account credit.

Chapter 7 bankruptcies remain in your credit file for 12 years.

Understanding the Financial Planning Process

Using Financial Statements and Budgets

Preparing Your Taxes

Managing Your Cash and Savings

Making Automobile and Housing Decisions

Using Consumer Loans

Insuring Your Life

Insuring Your Health

Protecting Your Property

Investment Planning

Investing in Stocks and Bonds

Investing in Mutual Funds

Planning for Retirement

Preserving Your Estate

Filters