Credit Basics Unit

A credit card offer comes in the mail with the bold print "0% A.P.R. for New Accounts." Which important piece of information should you find before thinking about signing up?

• Can I get two or more cards with this offer?

• Can I pay my credit card bill online?

• What is the A.P.R. after the introductory period?

• What kind of designs can I get on my card?

Reading through a credit card disclosure (aka the Schumer Box), you see the A.P.R. for is 9.99% - 23.99%. Which of the following statements is probably TRUE?

• Most cardholders pay the lowest rate listed

• Your credit scores determines the APR you wll get

• With credit card A.P.R.s, cardholders like higher A.P.R.s

• The A.P.R. on credit cards is usually fixed

Which of these credit card payback strategies would result in your paying the HIGHEST amount of interest?

• Paying 20% of your credit card balance every month on time

• Paying off your credit card bill in full every month

• Making the minimum payment (3% of your credit card balance) every month with an occasional late payment

Each of the following financial products will help you build credit history EXCEPT:

• Secured credit card

• Debit card

• Home mortgage

• Credit card

Based on the Card Statement, how much credit does this cardholder have available to use?

• $0

• About $500

• About $1600

• $2100

Which of the following statements comparing credit and debit cards is TRUE?

• Far more businesses accept credit cards than debit cards

• Credit cards pull money directly from your bank account, while debit cards get their money from Visa or Mastercard

• With debit cards, you're spending your own money while with credit cards, you're promising to pay back the money eventually

What statement about credit cards is TRUE?

• They can help you establish a credit history

• They are tied directly to your checking account, they prevent you from spending money you do not have

• As long as you make the minimum payments it's like getting a short-term interest free loan

What financial product am I? I am a type of credit card that requires cardholders to make a security deposit equal to the credit limit on their account. Due to this deposit requirement, I am often a good choice for young people looking to establish their credit history.

• Standard credit card

• Secured credit card

• Rewards credit card

Which of the following statements is TRUE?

• If you make the minimum payment on your card by the due date, the credit card company will not charge you interest.

• If you pay your balance in full after the due date, the credit card company will not charge you interest.

• If you pay your balance in full after the due date, you will be charged interest.

• If you pay your balance in full by the due date, you will be charged interest.

A credit card is offering 5% cashback program for all cardholders. Which question might help you evaluate how good this offer is?

• Does the cashback program apply to all purchases or only specific types of purchases like gas and groceries?

• Can I get a debit card along with a new credit card?

• Who do you use as their spokesperson in the commercial?