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WorksheetsCredit Basics
Total questions: 45
Worksheet time: 23mins
Name
Class
Date
1.
The two most commonly used types of credit are which of the following?
a)
Installment loans and Credit cards
b)
Credit and ATM cards
c)
Debit and ATM cards
d)
Installment loans and debit cards
2.
Whether you are dealing with a loan or a credit card,the actual amount borrowed is known as what?
a)
Annual percentage rate(APR)
b)
Minimum payment
c)
Principal
d)
Finance charge
3.
Whether you are dealing with a loan or a credit card,the amount of interest your payment includes each month is known as what?
a)
Principal
b)
Finance charge
c)
Minimum payment
d)
Annual percentage rate (APR)
4.
Whether you are dealing with a loan or a credit card,the percentage used to calculate the amount of interest you owe is known as what?
a)
Annual percentage rate(APR)
b)
Finance charge
c)
Principal
d)
Minimum payment
5.
When dealing with a credit card,the amount of money you must pay each month is known as what?
a)
Finance charge
b)
Annual percentage rate(APR)
c)
Principal
d)
Minimum payment
6.
Which of the following means to default on a loan or credit card?
a)
Make only the minimum payment each month
b)
Stop making payments with no ability to ever make payments
c)
Pay on the balance every month
d)
To pay off your balance in full
7.
The flexibility of buying on credit is consider which of the following?
a)
An advantage
b)
A pitfall
c)
A disadvantage
d)
A Danger
8.
The convenience of buying on credit is considered which of the following?
a)
An advantage
b)
A disadvantage
c)
A pitfall
d)
A danger
9.
Easy access when buying on credit is considered which of the following?
a)
A luxury
b)
A disadvantage
c)
An advantage
d)
Convenience
10.
Paying interest on small purchases when buying on credit is considered which of the following?
a)
A luxury
b)
A disadvantage
c)
An advantage
d)
Convenience
11.
Which of the following is the initial step of a credit card transaction?
a)
Authorization code is provided to the merchant
b)
Credit card is swiped by the merchant
c)
Funds for the purchase are captured on your account
d)
All steps happen at the same time
12.
During which latter step is a customer involved after making a purchase on a credit card?
a)
They need to make sure the merchant gets a confirmation.
b)
They need to make sure the credit card company gets the transaction.
c)
They are involved when it is time to pay the bill.
d)
They are not involved anymore in the purchase.
13.
What is a credit limit?
a)
Maximum amount which can be spent on a single purchase
b)
Maximum amount of all charges on the card at one time
c)
Minimum amount of all charges on a card at one time
d)
Minimum amount that can be spent on a single purchase
14.
For which of the following will additional charges NOT be charged to your account?
a)
Making a late payment
b)
Not making at least the minimum payment
c)
Charging more than your credit limit
d)
Making the minimum payment each month
15.
When you make a payment on your credit card, which of the following should be considered?
a)
A. The date the payment is due
b)
The number of purchases made on the account
c)
Your credit limit
d)
The time of year
16.
Which section of the credit card statement represents how much was owed at the beginning of the billing cycle and how much is owed at the end of the billing cycle?
a)
Balances
b)
Important dates
c)
Payments and purchases
d)
Limits and availability of credit
17.
Which section of the credit card statement shows the end date of the billing cycle, as well as the date the payment is due?
a)
Important dates
b)
Limits and availability of credit
c)
Balances
d)
Payments and purchases
18.
Which section of the credit card statement lists how much has been paid toward the balance of the credit card?
a)
Limits and availability of credit
b)
Balances
c)
Important dates
d)
Payments and purchases
19.
Which section of the credit card statement reports how much of the credit limit has been used and how much room is left within the credit limit?
a)
Payments and purchases
b)
Limits and availability of credit
c)
Important dates
d)
Balances
20.
Which of the following best represents finance charges which are calculated by subtracting the most recent payment from the closing balance of the last statement?
a)
Adjusted balance
b)
Average daily balance
c)
Previous closing balance
d)
Minimum balance
21.
Which of the following best represents finance charges which are calculated by adding up the daily balance in the account and dividing that number by the number of days in the billing cycle?
a)
Minimum balance
b)
Adjusted balance
c)
Average daily balance
d)
Previous closing balance
22.
Which of the following best represents finance charges which are calculated by using the closing balance from the last statement?
a)
Adjusted balance
b)
Average daily balance
c)
Previous closing balance
d)
Minimum balance
23.
When reconciling a statement, it is best if you have which of the following on hand to check the account for mistakes?
a)
Receipts acquired during the statement period
b)
Credit limit
c)
Daily balance
d)
Finance charges
24.
When reconciling a statement using financial software, it is generally NOT necessary to know which of the following in order to fill in the first screen of the reconciliation wizard?
a)
Opening balance
b)
Credit limit
c)
Closing balance
d)
Finance charges
25.
Which of the following does NOT affect the cost of credit?
a)
Grace periods
b)
Minimum payments
c)
Finance charges
d)
Annual fee
26.
Which of the following is the term for a fee a cardholder pays each year for the priviledge of using a specific company’s credit card?
a)
Annual fee
b)
Finance charges
c)
Grace period
d)
Minimum payment
27.
Which of the following is the term for the amount of interest paid on a balance carried each month?
a)
Finance charges
b)
Grace period
c)
Minimum payment
d)
Annual fee
28.
Which of the following is the term for the time allowed after a purchase is made, but before interest is charged to the account for the purchase amount?
a)
Minimum payment
b)
Annual fee
c)
Grace period
d)
Finance charges
29.
Which of the following is the term for the fee charged if a payment is late?
a)
Late fee
b)
Over the limit fee
c)
Cash advance fee
d)
Minimum payment fee
30.
Which of the following is the term for the fee charged if an amount charged is higher than your credit limit?
a)
Cash advance fee
b)
Over the limit fee
c)
Minimum payment fee
d)
Late fee
31.
Which of the following is the term for the fee charged when using your card to get cash?
a)
Minimum payment fee
b)
Cash advance fee
c)
Late fee
d)
Over the limit fee
32.
Which of the following will NOT affect the interest rate charged for balances carried on your account?
a)
Credit history
b)
Grace periods
c)
Current prime rates
d)
Credit ratings
33.
Which of the following will NOT affect the interest rate charged for balances carried on your account?
a)
Credit history
b)
Grace periods
c)
Current prime rates
d)
Credit ratings
34.
What does it mean to use a secure credit card?
a)
You have a higher level of security against identity theft.
b)
It tells merchants that your card has been stolen in the past.
c)
You can only charge up to what has already been pre-paidon the card.
d)
You have bad credit history.
35.
To build good credit, which of the following should you NOT do?
a)
Make payments on time
b)
Make at least the minimum payment
c)
Only have one to two cards at the most
d)
Never use the cards
36.
Which of the following can NOT be on the front of a credit or debit card?
a)
The main credit company such as Visa or MasterCard
b)
A participating business such as a university or a local bank
c)
The cardholder’s name
d)
The name of your personal banker
37.
Which of the following is used as a security measure in an effort to prevent fake cards from being used?
a)
Holographic image
b)
Bank name on the card
c)
Bright colors
d)
Different designs
38.
Of the 16 numbers on a credit card (dealing only with credit companies other than American Express), the first six numbers identify what?
a)
The company who has issued the card
b)
The region and branch location of the company who has issuedthe card
c)
Your actual account number
d)
A security checkpoint
39.
Of the 16 numbers on a credit card (dealing only with credit companies other than American Express), the seventh through tenth numbers identify what?
a)
The region and branch location of the company who has issuedthe card
b)
The company who has issued the card
c)
A security checkpoint
d)
Your actual account number
40.
Of the 16 numbers on a credit card (dealing only with credit companies other than American Express), the eleventh through the fifteenth numbers identify what?
a)
The company who has issued the card
b)
The region and branch location of the company who has issuedthe card
c)
A security checkpoint
d)
Your actual account number
41.
Of the 16 numbers on a credit card (dealing only with credit companiesother than American Express), the last number identifies what?
a)
Your actual account number
b)
The company who has issued the card
c)
The region and branch location of the company who has issuedthe card
d)
A security checkpoint
42.
When your credit card has expired, as shown by the expiration date on your card, the company does which of the following?
a)
Cuts off your credit limit
b)
Automatically renews your card
c)
Resets the security system
d)
Charges you an annual fee
43.
The magnetic strip on the back of the card does NOT contain which of the following?
a)
The credit card number
b)
The expiration date
c)
Your name
d)
Your credit limit
44.
The three digit code on the back of most cards tells the merchant which of the following?
a)
Your credit limit
b)
The expiration date
c)
A security code
d)
Your birth date
45.
Where should you record the customer service number on the back of the card?
a)
Your contact sheet at home
b)
On your driver’s license
c)
In your wallet
d)
On the front side of the card
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