Financial Simulation Questions

Why should you stay away from borrowing up to your credit limit?

• Because you're riding to the danger zone.

• Because Rave Damsey said so.

• Because it reflects poorly on your credit score.

• Because your interest rate increases when you borrow more on a credit card.

How do you prevent identity fraud?

• Publicly shout, "I... declare... bankruptcy!" so no one will want to steal your identity.

• You can't always, but you can regularly check your credit report to look for unusual or unfamiliar activity.

• Delete all of your social media accounts and always mask your identity online.

• Steal the fraudster's identity first. The best defense is good offense, right?

Which of the following deductions are you most likely to see on your pay stub?

• Health insurance deduction.

• Office cupcake deduction.

• Social Security deduction.

• Municipal tax deduction.

Which of the following is considered a positive entry on your credit report?

• You used credit.

  
  

• You closed a credit card account.

• You paid your cell phone bill on time.

• You applied for a loan

What's a "hard" inquiry?

• Asking your date if they're a Democrat or a Republican.

  
  

• A note that appears on your bank account when you've withdrawn over your limit.

• Another name for a mortgage application.

• Any time a financial institution requests your credit report for the purpose of extending more credit.

Which of the following is the most likely to appear on your credit report?

• Your current credit card APR.

  
  

• On-time utility payments.

• An unpaid parking ticket that went to collections.

• Your marital status.

What is a debt-to-income ratio?

• The amount ratio of your debt compared to your annual income.

• Something lenders look at on your credit report.

• A percentage that helps lenders decide your ability to pay back a loan.

• All of the above.

What does it mean to "claim an exemption" on your pay stub?

• Allow your employer to withhold money for taxes.

  
  

• Give your employer permission to put some of your earnings in a 401(k).

• Tell the IRS that you don't have to pay some or all of your taxes.

• None of the above.

You bought $230 in clothes and charged it to your credit card. What happens if you don't pay the balance off by the end of the month?

• You'll get a negative entry on your credit report.

  
  

• You'll see an increase on your interest rate.

•  The balance rolls over to next month.

• You'll start to accrue interest on your credit card balance.

Who needs life insurance?

• Anyone with dependents (i.e., spouse, kids, pets).

• Anyone with a 401(k).

• Anyone over the age of 35.

•  Anyone.