Consumer Credit Quiz

Consumer credit is the use of credit for ________ needs, except a home ________.

• personal, mortgage

• business, loan

• educational, lease

• medical, purchase

There are three ways consumers can finance current purchases. Take money from __________.

• savings

• loans

• credit cards

• investments

There are three ways consumers can finance current purchases. Use present __________.

• income

• savings

• credit

• loans

There are three ways consumers can finance current purchases. __________ against expected future income.

• borrow

• save

• invest

• donate

Debt for the purpose of purchasing ________ items or depreciating durable goods (getting stuff)

• Auto Debt / Recreational Vehicle Debt

• Home Mortgage

• Student Loan

• Retail Credit

Investment debt that ______ value

• Increases Loans

• Decreases Loans

• Business Loans

• Maintains Loans

Impact of paying only the ________ monthly balance

• minimum

• full

• partial

• average

Minimum ___-day grace period on new purchases

• 21

• 15

• 30

• 10

__________ of payments

• allocation

• distribution

• division

• assignment

Bar chart showing the true cost of minimum payments for a $5000 balance with varying interest rates and years.

• The cost remains constant regardless of interest rates.

• Higher interest rates increase the total cost over time.

• Minimum payments reduce the balance to zero immediately.

• Interest rates do not affect the cost of minimum payments.