Match each definition with the correct term.

• principal

• The party extending credit

• creditor

• The party receiving credit

• debtor

• The amount of money borrowed

A company that collects past-due bills for a fee

• collection agency

• creditor

• credit policy

• principal

A finance charge is the ​ (a)   paid by a ​ (b)   to a ​ (c)   for the use of credit.

• total amount
• borrower
• lender
• partial sum

A numerical measure of a loan applicant’s creditworthiness at a particular

point in time.

• credit risk

• credit policy

• credit score

• credit report

A record of credit history and financial behavior for a business or individual.

• credit risk

• credit policy

• credit score

• credit report

A written set of guidelines used by an organization to determine how many and

which customers will be approved for credit.

• credit risk

• credit policy

• credit score

• credit report

Credit is an agreement between ​ (a)   parties in which one party lends money or provides goods or services to another party with the understanding that payment will be made ​ (b)   ​ .

• two
• at a later date
• three
• in one year
• whenever possible

Credit granted based on a signed credit agreement.

• secured credit

• unsecured credit

• open-end credit

• installment credit

________ is the potential of credit not being repaid.

One of the benefits of credit is _____.

• the opportunity to buy costly items

• interest charges

• finance charges

• credit risk