PBMF 17.1

The amount paid by a borrower for the use of credit is called:

• Annual Percentage Rate

• Lending Fee

• Interest

You can buy a TV for $1000 cash or you can make a $100 down payment and $35 payments for 36 months. What is the installment price?

• $1360

• $1260

• $360

The process of setting financial goals and developing plans to reach them is called:

• Revenue

• Sales

• Financial Management

The annual cost of credit charged by a lender is called:

• Interest

• Annual Percentage Rate

• Principal

An agreement that allows the borrower to use a specific amount of credit over a period of time is called:

• Open End Credit

• Closed End Credit

• Installment Loan

A loan for a specific amount of money that is repaid with interest in regular installments is called:

• Open End Loan

• Revolving Loan

• Closed End Loan

You are going to buy a pair of skis for $225 with a down payment of $37. If you make payments for 12 months, how much are your payments?

• $18.75

• $15.67

• There is not enough information to answer this question

The amount of money borrowed (the original amount) is called:

• Interest

• Principal

• Annual Percentage Rate

This statement reports how cash moves in to and out of the business:

• Income Statement

• Cash Flow Statement

• Balance Sheet

A legal agreement between two parties in which one party lends money to another party with the understanding that payment will be made at a later date is called:

• Credit

• Debt

• Lending