Credit and Interest

Which one of the following is an asset that the borrower owns and uses as a guarantee until the loan is repaid to the lender?

• Property

• Money

• Collateral

• Deposits

What is the main source of income for banks?

• Interest on loans

• Interest on deposits

• Difference between the interest charged on borrowers and depositors

• None of these

Interest is the additional charge you get for borrowing money

• True

• False

What is the range for credit scores?

• 300-800

• 300-850

• 0-1000

What's one way to boost my credit score?

• Pay bills on time

• Use credit wisely

• Take out loans and pay them back with interest

Paul deposits $4000 in a bank which pays a compound interest rate of 4% per year. How much will he have in 5 years.

• $4866.61

• $5628.40

• $6077.53

• $6326.60

If Jarvis borrow $675 for six years at a simple interest rate of 10% , how much interest will he pay ?

• $504

• $1048

• $405

• $1055

One of the 5 C's of credit that shows a person's willingness to pay is

• capital
• collateral
• character
• capacity

One of the 5 C's of credit that shows one's ability to pay is

• capital
• collateral
• character
• capacity

What is a credit card?

• The ace of diamonds

• A large plastic card designed to ruin consumer's finances

• A small plastic card issued by the government attached to a line of credit

• A small plastic card issued by a bank and attached to a line of credit