Personal Finance Review - Part 2

Front

What is the difference between a bank and a credit union?

Back

Banks are for-profit institutions, while credit unions are non-profit.

Front

Which type of institution typically offers lower interest rates on loans? Options: Banks, Credit Unions, Both offer the same rates, Neither offers loans

Back

Credit Unions

Front

What is a payday loan?

Back

A short-term loan with high interest.

Front

What is a disadvantage of using both a title pawn loan and a payday loan?

Back

They can lead to a cycle of debt

Front

What is a fixed interest rate?

Back

An interest rate that remains the same throughout the loan term.

Front

What is the overall purpose of the Fair Credit Reporting Act?

Back

To promote fairness and accuracy in credit reporting

Front

Which type of interest is generally more expensive over time? Simple interest, Compound interest, Fixed interest, Variable interest

Back

Compound interest

Front

What is the primary purpose of auto insurance?

Back

To provide financial protection against car accidents

Front

Which of the following is a benefit of having a high credit score?
Options:
Higher interest rates on loans,
Lower interest rates on loans,
Fewer loan options,
Increased insurance premiums

Back

Lower interest rates on loans

Front

What is the main goal of the Fair Debt Collection Practices Act?

Back

To prevent abusive and unfair practices by debt collectors