Unit 8 Review

A special plastic card that you can use to pay for things directly from your bank account.

• Credit card

• Cash card

• Debit card

What is one difference between Banks and Credit Unions?

• Banks have Checking accounts and Credit Unions have Savings Accounts
• Banks are for profit.  Credit Unions are Non-profit.
• Banks can give loans and Credit Unions cannot
• Credit Unions allow everyone to join and Banks are selective

Which one of the following terms is money that is paid regularly at a particular rate for the use of borrowed money?
SSEPFb

• Deposit
• Withdrawal
• Interest
• Net Worth

The number that reflects your ability to get a loan and interest rates is your
SSEPF4a

• credit score
• credit karma
• bank rank
• LTF (Loan Trust Factor)

How do commercial banks make a profit?

• commercial banks are non-profit institutions.

• charge borrowers and depositors the same interest rate

• pay depositors a lower interest rate than they charge borrowers

• charge borrowers a lower interest rate than they charge depositors

Annual Percentage Rate (APR) is the yearly percentage rate of the finance charge. 

• True
• False 

Paying the minimum payment on a credit card every month will:

• Pay a large percentage of the total balance owed every month
• Make the final amount paid substantially higher than the amount initially charged to the card
• help the cardholder create a plan for paying of a credit card in a decent amount of time
• allow the cardholder to avoid paying any interest charges 

Which of the following effects Jamie’s credit score the MOST?

• His education level

• Being married

• How much he charges his customers

• His payments always being on time

Consumers have a number of options when obtaining a loan. Financial institutions range from banks to payday lenders, and loans range from long to short term. One type of short-term loan is called a title pawn loan. Which statement BEST describes why these types of loans should be avoided if possible?

• A person is unable to apply for a new car title for up to three years after paying back the total balance of a title pawn loan.

• A vehicle title must be provided in exchange for a loan, and people can potentially lose their vehicles if loans are not paid back.

• A person applying for a title loan must be approved by his or her employer, which is information some may want to keep private

• After receiving a title loan, people are not allowed to open savings or checking accounts at any banks for up to six months.

Which of the following financial institutions only serves its members?

• Savings and loan associations

• Commercial banks

• Credit Unions

• Payday lenders