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Credit Fundamentals

Total questions: 15

Worksheet time: 8mins

Name
Class
Date
1.

What is an annual fee?

a)

A fee charged for the cancellation of a service or membership.

b)
A fee charged monthly for the use of a service or membership.
c)

A fee charged once a year for the use of a service or membership.

d)
A fee charged per transaction for the use of a service or membership.
2.

What is an annual percentage rate?

a)
The annual percentage rate (APR) is the interest rate charged on a loan or credit card on a monthly basis.
b)

The annual percentage rate (APR) is the interest rate charged on a loan or credit card on an annual basis.

c)

The annual percentage rate (APR) is the interest rate charged on a loan or credit card on a daily basis.

d)
The annual percentage rate (APR) is the interest rate charged on a loan or credit card on a weekly basis.
3.

What is a credit card?

a)

A credit card lets you make monthly payments to repay money that you spend

b)
A credit card is a form of identification used to access bank accounts.
c)
A credit card is a prepaid card that can be used to make purchases.
d)
A credit card is a type of loan that does not require repayment.
4.

What is credit history?

a)

Credit history is a record of an individual's income and expenses.

b)
Credit history is a record of an individual's employment history.
c)
Credit history is a record of an individual's educational background.
d)

Credit history is a record of an individual's borrowing and repayment activities.

5.

What is a credit freeze?

a)
A credit freeze is a type of loan that allows you to borrow money.
b)

A credit freeze is a security measure that restricts access to your credit report.

c)
A credit freeze is a financial penalty for late payments on your credit card.
d)

A credit freeze is a service that helps improve your credit score.

6.

What is a credit report?

a)
A credit report is a summary of an individual's financial transactions.
b)

A credit report is a detailed history of how you have borrowed money in the past

c)
A credit report is a document that shows an individual's income and expenses.
d)
A credit report is a record of an individual's criminal history.
7.

What is credit score?

a)
A credit score is a numerical representation of an individual's creditworthiness.
b)
A credit score is a measure of an individual's income.
c)
A credit score is a rating given to a person's spending habits.
d)
A credit score is a reflection of an individual's net worth.
8.

What is fraud alert?

a)
A fraud alert is a notification sent to individuals to inform them of potential fraudulent activity on their bank accounts.
b)
A fraud alert is a notice placed on a person's credit report to warn lenders and creditors of potential identity theft or fraud.
c)
A fraud alert is a message sent to individuals to inform them that their credit card has been compromised.
d)
A fraud alert is a warning issued by the government to inform the public about a new type of scam.
9.

What is minimum payment?

a)

The minimum payment is the maximum amount of money that a borrower must pay towards their outstanding debt each month.

b)
The minimum payment is the average amount of money that a borrower must pay towards their outstanding debt each month.
c)

The minimum payment is the smallest amount of money that a borrower must pay towards their outstanding debt each month.

d)
The minimum payment is the total amount of money that a borrower must pay towards their outstanding debt each month.
10.

What is a student credit card?

a)
A student credit card is a type of debit card specifically designed for students.
b)
A student credit card is a type of prepaid card specifically designed for students.
c)
A student credit card is a type of loan specifically designed for students.
d)
A student credit card is a type of credit card specifically designed for students.
11.

Phishing is the fraudulent practice of sending emails pretending to be from respectable companies to get people to reveal personal information, such as passwords and credit card numbers

a)

True

b)

False

12.

Interest is a fee that is charged when you pay your bill after the due date

a)

True

b)

False

13.

Debt collection agency is a company hired to recover money that people haven’t paid back

a)

True

b)

False

14.

What is a debit card?

a)

A debit card is a credit card that allows the cardholder to borrow money from the bank.

b)
A debit card is a gift card that can be used to purchase items at specific stores.
c)

A debit card is a payment card that allows the cardholder to make purchases with funds directly from their checking account.

d)
A debit card is a loyalty card that offers discounts and rewards for frequent use.
15.

Cosigner : Someone like a parent, family member, or friend who promises to pay back a loan if you don’t

a)

True

b)

False