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PF Unit 4 Test

Total questions: 32

Worksheet time: 19mins

Name
Class
Date
1.

Value of property you own such as bank accounts investments real estate, after deducting debts.

a)

Credit

b)

Capital

c)

Collateral

d)

Finance Charge

e)

Line of Credit

2.

The use of someone else's money borrowed now and agreed to pay back later.

a)

Credit

b)

Capital

c)

Collateral

d)

Finance Charge

e)

Line of Credit

3.

Property pledged to assure repayment of a loan.

a)

Credit

b)

Capital

c)

Collateral

d)

Finance Charge

e)

Line of Credit

4.

The total dollar amount of all interest and fees you pay for credit.

a)

Credit

b)

Capital

c)

Collateral

d)

Finance Charge

e)

Line of Credit

5.

Established amount that can be borrowed on demand with no collateral.

a)

Credit

b)

Capital

c)

Collateral

d)

Finance Charge

e)

Line of Credit

6.

Open ended credit

a)

Borrower can use credit up to a stated limit

b)

Cost of credit expressed as a yearly percentage.

c)

loan for a specific amount that must be repaid in full.

d)

organization that makes high-risk consumer loans

e)

Legal business that makes high-interst loans based on the value of personal possessions.

7.

APR

a)

Borrower can use credit up to a stated limit

b)

Cost of credit expressed as a yearly percentage.

c)

loan for a specific amount that must be repaid in full.

d)

organization that makes high-risk consumer loans

e)

Legal business that makes high-interst loans based on the value of personal possessions.

8.

Closed end credit

a)

Borrower can use credit up to a stated limit

b)

Cost of credit expressed as a yearly percentage.

c)

loan for a specific amount that must be repaid in full.

d)

organization that makes high-risk consumer loans

e)

Legal business that makes high-interst loans based on the value of personal possessions.

9.

Finance Company

a)

Borrower can use credit up to a stated limit

b)

Cost of credit expressed as a yearly percentage.

c)

loan for a specific amount that must be repaid in full.

d)

organization that makes high-risk consumer loans

e)

Legal business that makes high-interst loans based on the value of personal possessions.

10.

Pawnbroker/ Pawnshop

a)

Borrower can use credit up to a stated limit

b)

Cost of credit expressed as a yearly percentage.

c)

loan for a specific amount that must be repaid in full.

d)

organization that makes high-risk consumer loans

e)

Legal business that makes high-interst loans based on the value of personal possessions.

11.

The complete record of all your borrowing and repayments.

a)

Credit History

b)

Credit Report

c)

Creditworthy

d)

Capacity

e)

Cosigner

12.

written statement of you credit history with a calculated number of your creditworthiness.

a)

Credit History

b)

Credit Report/score

c)

Creditworthy

d)

Capacity

e)

Cosigner

13.

Determination if you are a good credit risk, partially determined by your credit score.

a)

Credit History

b)

Credit Report/score

c)

Creditworthy

d)

Capacity

e)

Cosigner

14.

Financial ability to repay a loan. Partially used to determine creditworthiness.

a)

Credit History

b)

Credit Report/score

c)

Creditworthy

d)

Capacity

e)

Cosigner

15.

Someone who promises to repay a debt if the borrower fails to pay.

a)

Credit History

b)

Credit Report/score

c)

Creditworthy

d)

Capacity

e)

Cosigner

16.

Credit Score

a)

Likelihood you repay your debt, higher number means you are more likely to repay.

b)

Company hired by a creditor to collect the overdue ballance

c)

Equal Credit Opportunity was encacted to prevent this.

17.

Debt Collector

a)

Likelihood you repay your debt, higher number means you are more likely to repay.

b)

Company hired by a creditor to collect the overdue ballance

c)

Equal Credit Opportunity was encacted to prevent this.

18.

Discrimination

a)

Likelihood you repay your debt, higher number means you are more likely to repay.

b)

Company hired by a creditor to collect the overdue ballance

c)

Equal Credit Opportunity was enacted to prevent this in lending.

19.

When you buy something without making a conscious well thought out decision.

a)

Impulse buying

b)

Garnishment

c)

Phishing

d)

Unused Credit

e)

Rewards program

20.

Legal process allowing part of your paycheck to be directed towards debt repayment.

a)

Impulse buying

b)

Garnishment

c)

Phishing

d)

Unused Credit

e)

Rewards program

21.

Scams that deceive you into disclosing valuable personal information.

a)

Impulse buying

b)

Garnishment

c)

Phishing

d)

Unused Credit

e)

Rewards program

22.

Remaining credit available to you.

a)

Impulse buying

b)

Garnishment

c)

Phishing

d)

Unused Credit

e)

Rewards program

23.

Payback in the form of points. They will never be more valuable than the cost of not paying the balance off in full, or having a late payment.

a)

Impulse buying

b)

Garnishment

c)

Phishing

d)

Unused Credit

e)

Rewards program

24.

Interest rate offered to the best business customers.

a)

Prime Rate

b)

Fixed Rate loans

c)

Variable Rate Loans

d)

Principal

e)

Down payment

25.

Interest rates do not change for the life of the loan, thus payments should remain the same over time.

a)

Prime Rate

b)

Fixed Rate loans

c)

Variable Rate Loans

d)

Principal

e)

Down payment

26.

Interest rates change over the life of the loan based on Fed Funds Rate or other benchmark. Can make the payment amounts drastically increase and become unafordable.

a)

Prime Rate

b)

Fixed Rate loans

c)

Variable Rate Loans

d)

Principal

e)

Down payment

27.

The amount initially borrowed.

a)

Prime Rate

b)

Fixed Rate loans

c)

Variable Rate Loans

d)

Principal

e)

Down payment

28.

Part of the purchase price paid in cash upon borrowing the remaining ballance.

a)

Prime Rate

b)

Fixed Rate loans

c)

Variable Rate Loans

d)

Principal

e)

Down payment

29.

Legal process that relieves debtors of repaying debts or protects them while they attempt to repay. Has long lasting negative impacts on your ability to borrow.

a)

Credit Management

b)

Credit Counseling

c)

Bankruptcy

30.

Helps consumers manage debts and credit more wisely. May not be free.

a)

Credit Management

b)

Credit Counseling

c)

Bankruptcy

31.

An individual plan for using credit wisely, recognizing your limited ability to repay.

a)

Credit Management

b)

Credit Counseling

c)

Bankruptcy

32.

Review the items you listed as necessary on the "Brian's Skis" assignment. With the average American paying 30% interest on credit card debt, explain how that affects your views on carrying credit card debt. List and discuss any items you would remove from your necessary list. Explain your basic plan to responsibly use credit cards and manage your debt.

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