A credit card is offering 5% cashback. What question might you ask to decide if this is a good offer?

Does it apply to all purchases or only specific types of purchases?

What statement about credit cards is TRUE?

They can help you establish a credit history

Personal loans are called "personal loans" because...

They are lent based on your personal credit history rather than your assets

Which of the following statements about Federal student loans is TRUE?

The Federal government offers numerous loan repayment plans

If Suzanne applies for and receives a loan on a peer-to-peer lending website, who is supplying the funding to Suzanne?

An investor hoping to make money on her interest payments

Which statement below BEST describes how student loans should be used responsibly during college?

you can use them to pay tuition/room/board/books/fees/transportation

Which of the following statements comparing credit and debit cards is TRUE?

Debit cards take $ directly from your account. Credit cards do not.

If you are having trouble making loan/credit card payments, which recommendation is the LEAST useful piece of advice?

Only pay the highest debt; stop making payments on the other debts

A credit card offers 0% A.P.R. for New Accounts. Which important piece of information should you find before signing up?

What is the A.P.R. after the introductory period?

Which of the following statements is TRUE?

If you pay your balance after the due date, you will be charged interest.

Which of these credit card payback strategies would result in your paying the HIGHEST amount of interest?

Making the minimum payment (3% of your balance) every month on time

You see the A.P.R. for a specific card is set at 9.99% - 23.99%. Which of the following is probably true?

One of the primary factors determining your card's APR is your credit score

Which statement accurately describes a revolving line of credit?

You can buy items as you need them w/out getting approval for each purchase

You buy a $30,000 car. Which option would have the LOWEST monthly payment and the HIGHEST interest payments?

$0 down payment, 6% interest, 84 months

Each of the following is an advantage to leasing a car EXCEPT?

Late lease payments are not reported to the credit agencies

studbud

Unit 3: Credit

18 termsStudBud Administration36 plays

Use this Quiz to review for Financial Literacy Unit 3.

Flashcards18 cardsFPractice quizPHost liveL

Questions 18

Answers

1
A credit card is offering 5% cashback. What question might you ask to decide if this is a good offer?
Who does OrangeCo use as their spokesperson in the commercial?
Does it apply to all purchases or only specific types of purchases?
Do I still get the cash back even when I return my purchases to the store?
Can I get a debit card along with a new credit card?
2
What statement about credit cards is TRUE?
They can help you establish a credit history
If you make min. payments it's like getting a short-term interest-free loan
If you need to carry a balance, the interest rates are generally quite low
They are tied directly to your checking account
3
Personal loans are called "personal loans" because...
Apply for them inperson or online but the loan depends on your credit score
Given to someone based on their personal familiarity with the bank.
They are lent based on your personal credit history rather than your assets
You apply for them in-person, at your own bank or at a competing bank
4
Which of the following statements about Federal student loans is TRUE?
The Federal government offers numerous loan repayment plans
Federal loans are typically more expensive than private student loans.
Do not begin adding interest until after you graduate and are employed
You must take the SAT or ACT to qualify for Federal student loans.
5
If Suzanne applies for and receives a loan on a peer-to-peer lending website, who is supplying the funding to Suzanne?
An investor hoping to make money on her interest payments
People who have received a loan in the past on the website
The Federal government, funding the loan with tax dollars
A friend or family member who trusts her to repay the funds
6
Which statement below BEST describes how student loans should be used responsibly during college?
Student loans have low interest rates, you can use them for large purchases
you can use them to pay tuition/room/board/books/fees/transportation
They can only legally cover the costs of tuition, room, and board.
Use your student loans to pay for necessities OR to buy anything on campus
7
Which of the following statements comparing credit and debit cards is TRUE?
Credit cards pull money directly from your account. Debit cards don't.
Credit card companies provide a monthly statement, while debit cards don't
Far more businesses accept credit cards than debit cards
Debit cards take $ directly from your account. Credit cards do not.
8
If you are having trouble making loan/credit card payments, which recommendation is the LEAST useful piece of advice?
Reduce your spending
Find an extra source of income
Call your lenders and see if you can negotiate lower payments or interest
Only pay the highest debt; stop making payments on the other debts
9
A credit card offers 0% A.P.R. for New Accounts. Which important piece of information should you find before signing up?
Can I get two or more cards with this offer?
What is the A.P.R. after the introductory period?
What kind of designs can I get on my card?
Can I pay my credit card bill online?
10
Which of the following statements is TRUE?
If you pay your full balance late, you won't pay interest.
If you pay your balance after the due date, you will be charged interest.
If you make a minimum payment on your CC, you won't be charged interest.
If you pay your full balance by the due date, you will be charged interest.
11
Which of these credit card payback strategies would result in your paying the HIGHEST amount of interest?
Making the minimum payment every month with an occasional late payment
Paying 20% of your credit card balance every month on time
Paying off your credit card bill in full every month
Making the minimum payment (3% of your balance) every month on time
12
What credit card requires cardholders to make a security deposit equal to the credit limit on their account?
Secured Credit Card
Reward Credit Card
Overdraft Credit Card
Standard Credit Card
13
Each of the following financial products will help you build credit history EXCEPT:
Credit Card
Debit card
Secured credit card
Home mortgage
14
You see the A.P.R. for a specific card is set at 9.99% - 23.99%. Which of the following is probably true?
One of the primary factors determining your card's APR is your credit score
With credit card APRs, cardholders like higher APRs because they earn more
The A.P.R. on credit cards is usually fixed so they won't be adjusted
most cardholders pay the lowest rate listed
15
Which statement accurately describes a revolving line of credit?
They do not charge interest
One common example is a car auto loan
You owe the same payment every month
You can buy items as you need them w/out getting approval for each purchase
16
You buy a $30,000 car. Which option would have the LOWEST monthly payment and the HIGHEST interest payments?
$0 down payment, 6% interest, 84 months
$0 down payment, 6% interest, 60 months
$3000 down payment, 0% interest, 36 months
$3000 down payment, 6% interest, 60 months
17
Each of the following is an advantage to leasing a car EXCEPT?
Leases are typically short enough that the car stays under warranty
Late lease payments are not reported to the credit agencies
Monthly leases are cheaper than a car payment would be on a loan
Leases allow you to get a newer car more frequently than a car loan would
18
If the Credit Card Prime Rate increases from 3.25% to 4.25%, what impact would this have on APRs for cardholders?
Increase in A.P.R. by 4.25%
Decrease in A.P.R. by 1%
Increase in A.P.R by 1%
No change - credit card APRs don't change as long as your account is open

Unit 3: Credit Flashcards | StudBud