Understanding Credit Cards and Budgeting

Which of the following is a benefit of using a credit card responsibly?

• It always increases your debt

• It can help build a good credit score

• It guarantees you will never pay interest

• It allows unlimited spending without consequences

What is a credit score?

• The amount of money in your bank account

• A number that represents your trustworthiness to borrow money

• The number of credit cards you own

• The interest rate on your credit card

Which of the following is NOT a factor that affects your credit score in Canada?

• Payment history

• Amount of debt owed

• The colour of your credit card

• Length of credit history

Which Canadian financial institution is NOT a bank?

• Royal Bank of Canada (RBC)

• Toronto-Dominion Bank (TD)

• Canada Post

• Bank of Montreal (BMO)

What is the main purpose of creating a budget?

• To spend as much as possible

• To track and control your income and expenses

• To avoid paying taxes

• To increase your credit card limit

Which of the following is a good reason to compare different banks before opening an account?

• To find the best interest rates and lowest fees

• To get the fanciest debit card design

• To avoid having to remember your PIN

• To get free coffee

If you only make the minimum payment on your credit card each month, what will likely happen?

• Your balance will decrease quickly

• You will pay more interest over time

• Your credit score will automatically increase

• Your card will be cancelled

Which of the following is an example of a fixed expense in a budget?

• Groceries

• Rent or mortgage payment

• Entertainment

• Clothing

What is the legal age to apply for a credit card in most provinces in Canada?

• 14 years old

• 16 years old

• 18 years old

• 21 years old

Which of the following actions can help improve your credit score?

• Missing payments regularly

• Keeping your credit card balance low

• Applying for many credit cards at once

• Ignoring your credit report