Personal Finance-Chapter 16 Credit Management

Over ____% of all U.S. purchases are made with credit rather than cash.

• 40%

• 50%

• 75%

• 80%

________ is the use of someone else's money, borrowed now with the agreement to pay it back later.

• Debit

• Credit

• Collateral

• Capital

Between 1920 and 1990, buying on _______ became the American way of life.

• Cash

• Debit

• Capital

• Credit

In the 1990's, record number of people declared ___________. Overuse of credit cards was one of the main reasons.

• bankruptcy

• to be a millionaire

• to have plenty of money

• they were in no debt

A ___________ is a person who borrows money from others.

• creditor

• Loaner

• Lender

• Debtor

A _________ is a person or business that loans money to others.

• creditor

• debtor

• capital

• collateral

To qualify for credit, you must have the ability to repay the loan. Qualifications are based on

• income, capital, cars

• income, capital, collateral

• cars, capital, collateral

• income, cars, collateral

Two advantages of credit are

• over spending, buying later

• buying later, buying to much junk

• buying to much, overspending

• expand your purchasing power today, deferred billing

Two disadvantages of credit are

• deferred billing, buying now

• emergency fund, purchasing power today

• paying finance charges, overspending

• buying now, emergency fund

Your credit __________ is the complete record of your borrowing and repayment performance.

• files

• history

• card

• account