PF 6.03 Credit Cards

A yearly fee charged for having a credit card

• Over‐the‐limit fee

• Annual fee

• Returned payment

  fee

• Penalty APR fee

When a credit card company lowers the normal APR for new customers temporarily, to attract new customers

• APR

• Penalty APR

• Introductory APR

• Special APR

The smallest amount that must be paid on a credit card account each month

• 50% of the balance

• Total balance

• Minimum payment

• 25% of the balance

Sarah is 18. She want a credit card. Which statement is true?

• Sarah cannot obtain a credit card until she turns 21.

• Sarah will need to use a special application since she is under 25

• Sarah can get a card by filling out an application after she is 19.

• Sarah can get a credit card if she has a co-signer or proof of income

How can someone avoid paying interest on a credit card?

• pay the minimum balance each month before the due date

• pay the balance in full every month before the due date

• only use a credit card for balance transfers only

• there is not a way for him to avoid paying interest if he uses his card

Paying the minimum payment on a credit card every month will

• pay a large percentage of the total balance

• allow the cardholder to avoid paying any interest charges

• make the final amount paid much higher than the initial amount

• helps create a plan for paying the balance in a decent amount of time

which best describes how to incur Penalty APR.

• Megan missed her January payment while she went on vacation

• Megan's credit card payment has been paid in full each of the last 6 months

• Megan's card had a lower APR for the first year and now the interest rate has increased.

• The new computer Megan purchased made her account get close to her credit limit