Understanding Credit Cards Quiz

What is a credit card tied to?

• Savings account

• Revolving credit account

• Checking account

• Investment account

What is the maximum amount of money you can borrow at a time called?

• Credit score

• Grace period

• Credit limit

• Interest rate

What is the annual cost of borrowing money called?

• Grace period

• Interest rate

• Credit score

• Credit limit

What is the recommended percentage of available credit to use to keep your credit score high?

• 50%

• 10%

• 70%

• 30%

What is the safest way to shop online in terms of payment method?

• Check

• Credit card

• Debit card

• Cash

What type of credit card rewards give you miles for airline and hotel purchases?

• Cash back

• Travel rewards

• Zero percent introductory APR

• Balance transfer

What will reimburse you if something you bought with the card is damaged or stolen?

• Travel rewards

• Purchase protection

• Cash back

• Zero percent introductory APR

What should you avoid doing to get the most out of your credit card?

• Overspending

• Paying off the full balance

• Using the card responsibly

• Choosing a card with rewards

What is the main purpose of using a credit card?

• Building credit

• All of the above

• Earning rewards

• Shopping safely online

What should you do to stay out of debt when using a credit card?

• Choose a card with high interest rate

• Carry a balance

• Overspend

• Pay off the full balance each month