Financial Literacy - Wrap Up

What is the main difference between a credit card and a debit card?

• Credit cards have no spending limit.

• Debit cards are linked to a savings or transaction account.

• Credit cards require no repayment.

• Debit cards have higher interest rates.

Which of the following statements about credit cards is true?

• Credit cards always require a minimum monthly payment.

• Credit cards only charge interest on unpaid balances.

• Credit cards can help improve your credit score if used irresponsibly.

• Credit cards are always linked to a savings account.

When using a debit card for a purchase, which account is directly accessed for the payment?

• Credit account

• Investment account

• Savings or transaction account

• Retirement account

How does a credit card's interest work?

• Interest is only charged if you make late payments.

• Interest is added to your balance if not paid in full by the due date.

• Credit cards have fixed interest rates throughout the year.

• Interest is charged only on the annual fee.

Which of the following is a potential benefit of using a debit card?

• Earning cashback rewards on purchases

• Building a positive credit history

• Access to a pre-approved line of credit

• Protection against unauthorized transactions

Which financial concept involves borrowing money to be paid back with interest over time?

• Debit

• Credit

• Saving

• Investment

What is a credit limit on a credit card?

• The maximum amount you can save each month

• The maximum amount you can withdraw from an ATM

• The maximum amount you can spend using the card

• The minimum monthly payment required

How can a person avoid falling into credit card debt?

• Paying only the minimum balance each month

• Ignoring monthly statements

• Using credit cards for all daily expenses

• Paying the full balance by the due date

A debit card is directly linked to a person's _______ account, allowing them to spend money they already have

The process of evaluating a person's ability to repay a loan, often based on their ______________