2018 Personal Financial Literacy (August)

To build a good credit history, you should

• open as much credit as possible quickly
• use the maximum credit allowed on all your credit cards
• pay on time and as much of your balance as possible
• all of these

What is a credit score?

• A credit score is a three-digit numerical rating that reflects how likely you are to fail at paying your debts
• A five-digit numerical rating that reflects how likely you are to repay your debt. 
• A three-digit numerical rating that reflects how likely you are to repay your debt. 
• A credit score is a five-digit numerical rating that reflects how likely you are to fail at paying your debts

What financial habits determine your credit score?

• Payment History & Amount you owe 
• Length of credit history & Amount of new credit applied for recently
• Types of credit open
• All of these are correct

Credit cards, when used responsibly, can provide benefits for its consumers. Which statement below describes a benefit for a consumer using a credit card?

• A credit card company will allow you to buy now and pay back your debt when you are ready.
• A credit card doesn't cost you any more money than using a debit card as long as you make regular payments.
• Using a credit card responsibly and paying the balance off each month can help improve your credit score.
• People that use credit cards become wealthy more quickly.

Maintaining a good credit history by spending wisely and paying bills in a timely manner is beneficial to the consumer. Which combination of statements below list benefits of maintaining a good credit score?
1) People with good credit history have more financial options.
2) People with good credit history can get better interest rates on loans.
3) People with good credit history have better credit scores.
4) People with good credit history can borrow any amount of money.

• All statements list benefits of maintaining a good credit history.
• Only statements 1, 3, and 4 list benefits of a good credit score.
• Only statements 1, 2, and 4 list benefits of a good credit history.
• Only statements 1, 2, and 3 list benefits of a good credit history.

Linda needs a savings tool to help her manage her everyday purchases. The savings tool needs to be very liquid and accessible. Which savings tool should Linda choose?

• Certificate of deposit

• Checking account

• Money market deposit account

• Any of the above savings tools

The cost of borrowing money is referred to as 

• Interest 
• Annual Percentage Rate 
• Credit 
• Credit Line 

A consumer will develop a positive credit history if they:

• maintain reasonable amounts of unused credit
• pay phone and utilities on time
• pay cash for majority of purchases
• open credit accounts in their parent’s name

Your credit score will be significantly lowered if you

• You miss a loan payment
• Buy a house
• Take out a loan
• Go to college

Your house cost 100,000. You put 20% down. What is your down payment? 

• 10,000
• 20,000
• 100,000
• 120,000