Understanding Credit and Debit Cards

Who is credited with creating the first credit card?

• James Johnson

• Frank McNamara

• John Smith

• Robert Brown

What happens if you spend more than your account balance with a debit card?

• You receive a warning but no fee is charged

• The bank covers the cost temporarily and charges an overdraft fee

• The transaction is processed without any fee

• The transaction is declined

What is a key feature of a debit card?

• It allows borrowing money from a creditor

• It is linked directly to a checking account

• It offers a revolving line of credit

• It requires an annual usage fee

What is a revolving line of credit?

• A credit line that can be borrowed again as it is repaid

• A credit line that increases with each payment

• A credit line that resets annually

• A credit line that decreases with each payment

Why might someone choose to use a credit card instead of a debit card?

• To avoid paying any fees

• To have more time to pay for a large purchase

• To earn interest on their purchases

• To avoid having a credit limit