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Banks vs Alternatives

Social Studies

9th - 12th Grade

Used 1+ times

Banks vs Alternatives
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10 questions

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1.

MULTIPLE CHOICE QUESTION

30 sec • 1 pt

What is a common feature of payday lenders, pawn shops, and check cashing services?

They all require a credit check.
They all offer free financial advice.
They all charge high fees for their services.
They all provide long-term loans.

2.

MULTIPLE CHOICE QUESTION

30 sec • 1 pt

How does the APR of payday loans compare to that of credit unions?

Credit unions have a maximum APR of 28%, while payday loans can be as high as 575%.
Payday loans have a lower APR than credit unions.
Credit unions do not charge any APR.
Both payday loans and credit unions have similar APRs.

3.

MULTIPLE CHOICE QUESTION

30 sec • 1 pt

What does APR stand for, and why is it important in borrowing?

Annual Principal Rate; it reflects the principal amount borrowed.
Average Payment Rate; it shows the average cost of loans.
Annual Percentage Rate; it indicates the cost of borrowing over a year.
Annual Payment Rate; it determines the monthly payment amount.

4.

MULTIPLE CHOICE QUESTION

30 sec • 1 pt

If a $300 payday loan has an APR of 385%, how much interest will you pay?

$100
$150
$9
$65

5.

MULTIPLE CHOICE QUESTION

30 sec • 1 pt

What could happen if you fail to repay a payday loan?

You may receive a lower interest rate on future loans.
You could face fees for overdrawing your account.
You will be automatically forgiven the loan.
You may receive a refund of your interest payments.

6.

MULTIPLE CHOICE QUESTION

30 sec • 1 pt

What is a common misconception about payday loans?

They are always the best option for quick cash.
They have no fees associated with them.
They can lead to a cycle of debt if not managed properly.
They are regulated by the government.

7.

MULTIPLE CHOICE QUESTION

30 sec • 1 pt

Which of the following statements is true regarding check cashing services?

They do not charge any fees for cashing checks.
They are the only option for cashing checks.
They offer better rates than banks for cashing checks.
They charge around 3.5% of the check amount.

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