Credit & Borrowing Pre-Test

Vocabulary: A numerical rating predicting how likely you are to pay a loan.

• Credit Limit

• Balance

• Credit Score

• Interest Rate

True or False: Car loans typically have the shorter loan terms than mortgages.

• True

• False

How do credit card companies entice users to spend money on their card? (Choose all that apply)

• They charge no interest on purchases made with the card.

• They use predatory marketing practices with 'too good to be true' offers.

• They provide users with rewards like airline miles, cash back, and more.

• They offer extremely high credit limits to users.

Jane buys a TV from Walmart for her college dorm room. She uses a PIN to verify the purchase at the register. What card did she use?

• Debit Card

• Credit Card

What form must be filled out to receive financial aid?

• 1040 form

• W-2 form

• W-4 Form

• FAFSA

What are the four types of financial aid offered by the US Government?

• Loans, Scholarships, Work-Study Programs, Apprenticeship Programs

• Loans, Scholarships, Grants, Internship Programs

• Loans, Grants, Scholarships, Internship Programs

• Loans, Grants, Scholarships, Work-Study Programs

What is the most important factor to building a good credit score?

• Paying your bills on time.

• Having a long credit history.

• Having a high income.

• Having a large number of credit cards.

Describe the difference between a debit card and a credit card.

Explain how a poor credit score can negatively affect your everyday life as an adult.

Describe the relationship between loan term and monthly payment amount. Why are mortgages typically longer than 15 year loan terms?