When does someone pay “interest?”

When they borrow money from bank or store

Which of the following statements are true about interest rates?

Fixed interest rates stay the same over time, Variable interest rates change over time

If you borrow $10,000 from a bank to buy a new car, and you don’t pay back the loan, what can happen?

The car can be seized (taken back) by the bank

Select all of the things you should buy with a credit card

Gas, Services -- hair cut, Groceries

All of the following statements are true EXCEPT:

A lower interest rate means you pay more money

money given to someone by a bank or credit union

What can you ask yourself to determine if something is a “need” versus a “want?”

Can I still function in life without this item?, Will something bad happen if I don’t have this item?

something necessary for one to function in life

Definition of repayment

to pay money back to someone you borrowed from

something that makes our lives better, but isn’t necessary to live

What does it mean to “use credit"?

You use borrowed money to buy something

Definition of Financial Literacy

ability to understand how to responsibly manage one’s money

How can your credit score impact your ability to receive a loan from a bank?

If you have a high credit score, you are more likely to receive a loan

How does the length of a loan impact your monthly payment?

The shorter the loan term, the more your monthly payment is

Definition of Late Fees

extra money charged for not paying your money back on time

Definition of Interest

extra money you pay for borrowing money

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2025 8th Financial Literacy

26 termsStudBud Administration58 plays

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Questions 26

Answers

1
Where can you get a loan?
Stores
Banks
Credit Unions
High Schools
2
True or False: You can pay interest when using a debit card, not a credit card
False
True
3
All of the following are considered “wants” EXCEPT:
Netflix
Computer
Clothing
Phone
4
When does someone pay “interest?”
When they borrow money from bank or store
When they are late to pay back their money
All of the above
When they spend too much money
5
Which of the following statements are true about interest rates?
Fixed interest rates change over time
Fixed interest rates stay the same over time
Variable interest rates change over time
Variable interest rates stay the same over time
6
True or False: If you have a credit card from a store, you can only use it at that specific store
False
True
7
If you borrow $10,000 from a bank to buy a new car, and you don’t pay back the loan, what can happen?
The car can be seized (taken back) by the bank
Your credit score goes up
Your monthly payment goes down
Your interest rate goes up
8
True or False: you should take out a loan to buy a bicycle
True
False
9
Credit cards are all of the following EXCEPT:
Great for emergency situations
Acts as cash
Convenient
Money is borrowed and repaid at a later date
10
Select all of the things you should buy with a credit card
Gas
College tuition
Services -- hair cut
Groceries
11
When you use a debit card, where does the money come from?
Debit account
Credit account
Your mom
Checking account
12
All of the following statements are true EXCEPT:
A lower interest rate means you pay more money
Credit cards and loans have different interest rates
Interest means you repay money to whoever gave you the loan
Credit cards and loans are both ways to use and build credit
13
Definition of Credit
money given to someone by a bank or credit union
extra money you pay for borrowing money
extra money charged for not paying your money back on time
borrowing money to buy something
14
True or False: You can get a credit card from your school
False
True
15
What can you ask yourself to determine if something is a “need” versus a “want?”
Can I still function in life without this item?
None of these answers
How expensive is the item?
Will something bad happen if I don’t have this item?
16
Definition of a Need
to pay money back to someone you borrowed from
something necessary for one to function in life
ability to understand how to responsibly manage one’s money
something that makes our lives better, but isn’t necessary to live
17
Definition of repayment
to pay money back to someone you borrowed from
something that makes our lives better, but isn’t necessary to live
something necessary for one to function in life
ability to understand how to responsibly manage one’s money
18
Definition of a want
something necessary for one to function in life
to pay money back to someone you borrowed from
something that makes our lives better, but isn’t necessary to live
ability to understand how to responsibly manage one’s money
19
What does it mean to “use credit"?
You use a savings account
You use a debit card
You use borrowed money to buy something
You use a checking account
20
Definition of Financial Literacy
something that makes our lives better, but isn’t necessary to live
ability to understand how to responsibly manage one’s money
to pay money back to someone you borrowed from
something necessary for one to function in life
21
True or False: Banks and credit unions are “lenders,” while people like us are“borrowers”
True
False
22
How can your credit score impact your ability to receive a loan from a bank?
If you have a high credit score, you are less likely to receive a loan
If you have a low credit score, you are more likely to receive a loan
If you have a high credit score, you are more likely to receive a loan
None of the above
23
How does the length of a loan impact your monthly payment?
The shorter the loan term, the more your monthly payment is
None of the above
The longer the loan term, the more your monthly payment is
The shorter the loan term, the less your monthly payment is
24
True or False: Food, Water, Shelter are all NEEDS
False
True
25
Definition of Late Fees
money given to someone by a bank or credit union
extra money you pay for borrowing money
borrowing money to buy something
extra money charged for not paying your money back on time
26
Definition of Interest
money given to someone by a bank or credit union
extra money you pay for borrowing money
borrowing money to buy something
extra money charged for not paying your money back on time

2025 8th Financial Literacy Flashcards | StudBud