Managing Credit Quiz

What is one benefit of a secured loan?

• Higher interest rate

• No need for collateral

• Lower interest rate

• No repayment required

What is a difference between credit cards and debit cards?

• Credit cards spend borrowed money, debit cards spend your money

• Credit cards have no interest, debit cards do

• Debit cards earn rewards, credit cards do not

• Debit cards build credit, credit cards do not

What is the principal in terms of credit card payments?

• The total interest paid

• The original amount borrowed

• The total fees incurred

• The monthly payment amount

What is the purpose of a credit card?

• To provide unlimited funds

• To extend a line of credit for purchases

• To eliminate financial responsibility

• To offer free services

What is the average APR for credit?

• 10%

• 15%

• 5%

• 25%

What is another name for APR?

• credit score

• credit history

• interest rate

• grace period

The higher the credit score, the _________ the interest rate.

When calculating a credit score, one must considered the highest percentage which is...

• new credit

• money owed

• payment history

• length of credit history

The remaining amount owed on a credit card or loan is called __________________________.

• balance

• secured credit card

• balance transferred

• unsecured credit card

What are the two most important factors in calculating your credit score?

• Payment history and types of accounts

• Amounts owed and length of credit history

• Payment history and total debt

• Length of credit history and new credit inquiries