College Funding Methods

What is the main advantage of receiving a grant for college?

• It must be paid back with interest

• It requires working while in school

• It doesn't need to be paid back

• It's only available to athletes

Answer explanation

The main advantage of receiving a grant for college is that it doesn't need to be paid back, making it a valuable source of financial aid compared to loans that require repayment with interest.

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Which funding option allows students to earn money while gaining work experience on campus?

• Student loans

• Work-study programs

• Private scholarships

• Federal grants

Answer explanation

Work-study programs provide students with the opportunity to earn money while gaining valuable work experience on campus, making them an ideal funding option for balancing education and employment.

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What is a potential disadvantage of relying on student loans for college funding?

• You have to maintain a certain GPA

• You must work part-time

• You have to repay with interest

• You need athletic ability

Answer explanation

A potential disadvantage of relying on student loans is that you have to repay them with interest, which can lead to significant financial burden after graduation.

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Which type of college funding is typically awarded based on academic achievement?

• Merit-based scholarships

• Federal work-study

• Need-based grants

• Student loans

Answer explanation

Merit-based scholarships are awarded based on academic achievement, recognizing students for their high grades or test scores. In contrast, federal work-study, need-based grants, and student loans focus on financial need or employment.

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What is a key benefit of work-study programs?

• They provide immediate full tuition coverage

• They offer flexible work schedules around classes

• They don't require any work hours

• They automatically renew each year

Answer explanation

A key benefit of work-study programs is that they offer flexible work schedules around classes, allowing students to balance their work commitments with their academic responsibilities effectively.

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How are need-based grants usually determined?

• By athletic performance

• By family income level

• By high school grades

• By volunteer hours

Answer explanation

Need-based grants are primarily determined by family income level, as they aim to assist students who require financial support to pursue their education. Other factors like grades or volunteer hours do not directly influence these grants.

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Which funding source often requires a FAFSA (Free Application for Federal Student Aid) application?

• Private bank loans

• Athletic scholarships

• Federal student loans

• Family savings

Answer explanation

Federal student loans require a FAFSA application to determine eligibility for financial aid. In contrast, private bank loans, athletic scholarships, and family savings do not necessitate this application.

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What is an advantage of merit-based scholarships?

• They're available to all students

• They require work hours

• They're based on financial need

• They reward academic excellence

Answer explanation

Merit-based scholarships reward academic excellence by recognizing students' hard work and achievements. This motivates students to excel in their studies, unlike scholarships based on financial need or requiring work hours.

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Which college funding option typically has the highest long-term cost?

• Private student loans

• Federal grants

• Merit scholarships

• Work-study programs

Answer explanation

Private student loans typically have the highest long-term cost due to high interest rates and lack of flexible repayment options, making them more expensive over time compared to federal grants, merit scholarships, and work-study programs.

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What is a key feature of most federal student loans?

• They have higher interest rates than private loans

• They offer income-based repayment options

• They require immediate repayment

• They're only for graduate students

Answer explanation

A key feature of most federal student loans is that they offer income-based repayment options, allowing borrowers to manage their payments based on their income, unlike private loans which typically do not offer this flexibility.

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