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WorksheetsLoans
Total questions: 20
Worksheet time: 25mins
The amount of money that the lender lends to the borrower is called the....
principal
down payment
default
collateral
A fixed amount of money paid out of pocket to reduce the amount borrowed.
Credit history
Loan terms
Down payment
Annual percentage rate (APR)
Interest can be defined as:
a charge for lending money
the fee charged for borrowing money
the amount added into your savings account when opening a bank account
a charge for convenience of accessing money in your bank
APR stands for
annual profit rate
annual percentage rate
annual participation rate
annuity profit range
The longer the loan term the less total interest you pay.
False
True
The down payment is the final payment you make when you are done paying off your loan.
True
False
Which of the following loans at 5% APR would have the LOWEST monthly payment?
3 year loan
4 year loan
5 year loan
7 year loan
Which of the following loans at 5% APR would result in the LOWEST total cost of a car loan?
3 year loan
5 year loan
4 year loan
6 year loan
Which of the following 5 year loans would result in the LOWEST total cost of a car loan?
3% APR
4% APR
5% APR
6% APR
In general, which of the following loans will cost more money in interest?
3 year loan
5 year loan
4 year loan
7 year loan
In General, which of the following will result in the LOWEST monthly payment, but also the MOST in interest?
10 year loan
15 year loan
20 year loan
30 year loan
When taking out a loan, the longer the length of the loan is...
the lower your monthly payment will be, but the interest paid will be higher
the higher your monthly payment will be, but the interest paid will be lower
the higher the monthly payment will be AND the higher the interest paid will be
the monthly payment and the interest paid will be the same
One trick a car salesman will try to get you to buy a car is to show you a loan with......because this makes the monthly payment lower.
a longer loan period (example a 7 year loan rather than a 3 year loan)
a shorter loan period (example a 3 year loan rather than a 7 year loan)
2 loans with the exact same time period
a cash payment option
If you INCREASE the amount of your down payment, how will it affect the monthly payment?
The monthly payment will go down
The monthly payment will go up
the monthly payment will stay the same
One way to be sure that you are not being taken advantage of when buying a car is to...
Research the current interest rates for car loans BEFORE you go to the dealership
Increase the length of the car loan until you can afford the monthly payment
Take the loan that the dealership offers you because they are professionals
None of the above
The APR and the length of a loan...
will determine BOTH what the monthly payment and total interest will be
will determine ONLY the monthly payment
will determine ONLY the interest
