Credit, Installment, Debt

Which one of the following is an example of Installment Credit?

• Bank credit card

• Payment plan for an appliance

• Bill for dental care

• Gas bill

Which one of the following is an example of Revolving Credit?

• Store credit card

• Electricity bill

• Car loan

• Student Loan

Tim is buying bedroom furniture on installment. If he makes monthly payments of $165 for 8 months, how much will he pay for that furniture?

• $1,650

• $1,320

• $990

• $1,155

Jake is buying a used car on installment credit. If he owes $7,392 and he makes monthly payments of $308, how long will it take him to pay off the car?

• 4 years

• 3 years

• 2 years

• 1 year

Karen borrowed $3,200 at 9% simple interest and paid it all back 2 years later. How much did he pay in interest only? (Remember Interest=P*R*T)

• $288

• $576

• $3,776

• $864

Tanya has a credit card balance of $1,650 on her credit card. The minimum payment is 3% of his balance. What is her minimum payment?

• $49.50

• $4.95

• $66.00

• $38.24

This is the original amount of loan before interest.

• principal

• loan term

• credit

• interest

This is the cost of using credit; charged as a percentage of the principal or balance

• principal

• loan term

• credit

• interest

Lance can choose to pay $1,312 in cash for a new refrigerator or make 8 installment payments of $170.56. If he chooses the installments, how much interest will he pay?

Which type of interest accumulates faster?

• Compound

• Simple