credit cards

What is credit?

• Money allocated to a specific account for future use by the consumer without borrowing
• Goods, services, or money received in exchange for a promise to pay a definite sum of money at a future date
• The ability and willingness of an individual to pay back a loan as perceived by the lender
• An individual’s character, capital, capacity, collateral and conditions

What is one characteristic of open-end credit?

• A down payment must be made before receiving the loan

• Individuals are allowed to borrow an unlimited amount of money as long as they pay it back

• Credit is extended in advance so the borrower does not have to apply for credit each time credit is desired

• Payments are equal and are required on a regular basis

Amount charged if your payment is received after the billing date

• late payment fee
• overdue fee
• withdrawal fee
• loser fee

Tags

CCSS.RI.11-12.4

CCSS.RI.7.4

CCSS.RI.8.4

CCSS.RI.9-10.4

CCSS.RI.9-10.4

Maximum amount you are allowed to carry as a balance on the card

• interest
• ARP
• credit line
• all of these

This is a fee that some, but not all, credit card issuers charge to use their credit card.

• APR
• annual fee
• monthly fee
• no such thing

Tags

CCSS.RI.11-12.3

CCSS.RI.11-12.5

CCSS.RI.8.5

CCSS.RI.9-10.3

CCSS.RI.9-10.5

The amount based on the percentage of the outstanding balance, or a minimum fixed amount

• minimum monthly fee
• minimum monthly payment
• minimum monthly statement
• minimum monthly charge

Benefits of credit cards include:

• safe and convenient, bonuses are offered
• allows you to build a positive credit report
• needed for reservations and online shopping
• all of these

The maximum amount you may borrow on a credit card is known as:

• creditworthiness
• credit report
• credit limit
• variable rate of credit

Tags

CCSS.RI.11-12.3

CCSS.RI.11-12.5

CCSS.RI.8.3

CCSS.RI.9-10.3

CCSS.RI.9-10.5

Over time, people who pay off their credit card balance in full every month will pay less in interest on their credit card.

• true
• false

The rate at which interest is charged on a credit card acount is expressed in terms of its:

• Annual Percentile Reduction
• Animal Population Rescue
• Annual Popsicle Reduction
• Annual Percentage Rate