UNHS - Personal Finance - Self check 12

A person who borrows money or buys with credit is called a ____

• creditor.

• lender.

• debtor.

• lien holder.

Which type of credit usually involves an installment loan?

• A.

  open-end credit

• B.

  general-purpose credit card

• C.

  subprime credit card

• D.

  closed-end credit

What is an ADVANTAGE of using credit?

• A.

  less likely to overspend

• B.

  fewer fees and less interest

• C.

  lets you take advantage of sales

• D.

  funds are taken from your own account

The amount of debt you must pay in a billing cycle is the

• A.

  balance.

• B.

  minimum payment due.

• C.

  annual percentage yield.

• D.

  grace period.

The annual cost that a lender charges for extending credit is the

• A.

  annual percentage yield.

• B.

  balance.

• C.

  credit score.

• D.

  installment payment.

What is NOT a way to establish creditworthiness?

• A.

  Get a job.

• B.

  Open a savings account.

• C.

  Open a checking account.

• D.

  Apply for a subprime credit card.

Collateral is

• A.

  the amount of interest that a creditor charges.

• B.

  the amount of money you save by buying with credit.

• C.

  property a lender may take if debts are not paid.

• D.

  the amount paid up front when making a purchase.

What is a revolving credit account?

• an open-end credit account that requires the balance to be paid each month

• a closed-end credit account that requires the balance to be paid each month

• an open-end credit account that does NOT allow the balance to be paid monthly

• open-end credit in which debt may be paid monthly or spread out over time

Credit bureaus are responsible for

• repossessing goods not paid for

• accumulating credit histories.

• ruling in Chapter 10 bankruptcy cases.

• ruling in Chapter 13 bankruptcy cases.

Which of the following should you NOT do?

• Keep expired credit cards for your records.

• Review transactions on your credit card statements.

• Memorize all of your credit card numbers.

• Decline to let other people borrow your credit cards.