51. What type of information is not found on a consumer’s credit report?

• A.   Personal medical information.
• B.  Criminal records.
• C.   Employment history.
• D.  Current and past addresses.

52.  Hillary and Stephanie have both borrowed $15,000 from the same bank to buy the same model of a new car. Hillary's credit score is 732 and Stephanie's credit score is 588. Who is likely to pay a lower finance charge?

• A.   They will pay the same because they used the same bank.
• B.  Hillary.
• C.   Stephanie.
• D.  They will pay the same because they bought the same car.

53. Choose the best suggestion for building and maintaining a good credit score.

• A.   Have money in savings and protect against identity theft.
• B.  Keep debt low and pay bills on time.
• C.   Make safe investments and set clear financial goals.
• D.  Comparison shop and follow a budget.

54. What is true about loans?

• A.   The lower the APR, the more interest is paid.
• B.  The larger the down payment, the lower the principal.
• C.   The shorter the length of the loan, the smaller the payments.
• D.  The higher the APR, the less interest is paid.
  

55. An example of identity theft is when an individual

• A.   uses a parent’s charge account to buy lunch for friends.
• B.  uses another person’s information to open an account.
• C.   notifies a credit reporting agency of an unpaid debt.
• D.  has the same name as another person in the same state. 

56. It is generally a good idea to borrow money and repay the amount borrowed with future income when

• A.   a person needs to buy a car to get a much better paying job.
• B.  a person really needs a week’s vacation.
• C.   clothing a person likes goes on sale.
• D.  the interest on the loan is greater than interest being earned on savings.

57. If a person is behind on his debt payments and goes to a responsible credit counseling service, what help is likely to be offered?

• A.   They can cancel and cut up his credit cards without his permission.
• B.  They can get the federal government to apply his income taxes to pay off his debts.
• C.   They can work with those who loaned him money to set up a realistic payment schedule.
• D.  They can force those who loaned him money to forgive his debts.

58. Scott and Eric are young men with good credit reports. They work at the same company and make approximately the same salary. Scott has borrowed $6,000 to take an overseas vacation. Eric has borrowed $6,000 to buy a truck. Who is likely to pay the lowest finance charge?

• A.   Eric will pay less because the truck is collateral for the loan.
• B.  Scott will pay less because people who travel overseas are less risky to lenders.
• C.   They will both pay the same because the rate of interest on the loan is set by law.
• D.  They will both pay the same because they are borrowing the same amount of money.

59. An arrangement to receive cash, goods or services now and pay for them in the future is called

• A.   credit.
• B.  liquidity.
• C.   collateral.
• D.  net income.

60. The rate imposed by the lender for the borrower to pay on a loan is known as

• A.   money market rate (MMR). 
• B.  effective annual rate (EAR).
• C.   annual percentage rate (APR).
• D.  debit card rate (DCR).