Debit vs Credit Cards Quiz

What is a debit card?

• A credit card that allows the user to borrow money for purchases

• A payment card that deducts money directly from a consumer's checking account to pay for a purchase.

• A gift card that can only be used at specific stores

• A form of identification used to access a bank account

What is the main function of a credit card?

• To allow the cardholder to make purchases at the store using their own money

• To serve as a pass for public transportation

• To allow the cardholder to make purchases and pay for them at a later date

• To offer discounts at various stores

How are debit and credit cards used differently?

• Debit cards use the cardholder's money, while credit cards use the bank's money.

• Debit cards use the cardholder's own money, while credit cards allow people to borrow money up to a certain limit.

• Debit cards have a higher interest rate than credit cards.

• Debit cards have a lower spending limit than credit cards.

What are the typical fees associated with a debit card?

• Monthly maintenance fees, ATM withdrawal fees, overdraft fees, and foreign transaction fees

• Cash deposit fees

• Annual membership fees

• Online banking fees

What are the typical fees associated with a credit card?

• Interest fees

• Annual fees, late payment fees, balance transfer fees, cash advance fees, foreign transaction fees, and over-limit fees

• Application fees

• Credit score fees

What are the advantages of using a debit card?

• There are no interest charges, helps control spending, no risk of debt accumulation.

• Encourages overspending

• Limited acceptance

• High interest charges

What are the disadvantages of using a debit card?

• No risk of fraud

• More consumer protection than credit cards

• No potential for overdraft fees

• Does not help you build credit

What are the advantages of using a credit card?

• High interest rates

• Limited acceptance

• No benefits or rewards

• Convenience, rewards, build credit history, purchase protection, and fraud protection.

What are the disadvantages of using a credit card?

• Low interest rates, limited purchasing power, no rewards or benefits

• Possible overspending, high interest rates, potential debt accumulation

When would it be better to use a debit card instead of a credit card, and vice versa?

• Use a credit card for everyday expenses

• Always use a debit card for online purchases

• Debit cards are better for building credit history

• It depends on the purpose of the transaction and your ability to pay off the amount.