Question 1

Which of the following is an improper use of credit?

Accepted Answer

A) Buying a home 
B) Buying a short-lived good 
C) Spreading payments within a budget 
D) Purchasing a big-ticket item 
E) Meeting a financial emergency 
A) Buying a home 
B) Buying a short-lived good 
C) Spreading payments within a budget 
D) Purchasing a big-ticket item 
E) Meeting a financial emergency

Question 2

Credit reports on individual borrowers are provided by credit card issuers.

Accepted Answer

A) True 
 B)False

Question 3

Ted and Karen have a combined take-home income of $4,500. Their total monthly payment on consumer debt is $875. What is their debt safety ratio? Are they exhibiting any signs of approaching credit problems?

Accepted Answer

Ted and Karen's debt safety ratio is 19.

Question 4

If a borrower has a high FICO score, then there is:

Accepted Answer

A) a minimal chance of his or her loan getting approved. 
B) no chance of his or her loan getting approved. 
C) a high chance of his or her loan getting approved. 
D) a high chance of more collateral requirements for his or her loan. 
E) a high chance that a higher interest rate will be charged. 
A) a minimal chance of his or her loan getting approved. 
B) no chance of his or her loan getting approved. 
C) a high chance of his or her loan getting approved. 
D) a high chance of more collateral requirements for his or her loan. 
E) a high chance that a higher interest rate will be charged.

Question 5

A person who pays off his credit balance every month should look for a credit card with a:

Accepted Answer

A) long grace period. 
B) high annual fee. 
C) high interest rate. 
D) low interest rate on existing balance. 
E) low introductory rate. 
A) long grace period. 
B) high annual fee. 
C) high interest rate. 
D) low interest rate on existing balance. 
E) low introductory rate.

Question 6

An individual can be overusing credit even if he or she can afford to make the minimum monthly payments on time.

Accepted Answer

A) True 
 B)False

Question 7

Chapter 7 of the bankruptcy code:

Accepted Answer

A) restores all the losses incurred by the borrower. 
B) results in the loss of all of one's assets. 
C) requires the debtor to pay back the debt in the future. 
D) sells only the home of the borrower. 
E) eliminates most of the financial obligations of the borrower. 
A) restores all the losses incurred by the borrower. 
B) results in the loss of all of one's assets. 
C) requires the debtor to pay back the debt in the future. 
D) sells only the home of the borrower. 
E) eliminates most of the financial obligations of the borrower.

Question 8

Lenders use the guideline that a borrower's monthly repayment burden should not be more than 20% of the borrower's take-home income.

Accepted Answer

A) True 
 B)False

Which of the following is an improper use of credit?

Credit reports on individual borrowers are provided by credit card issuers.

Ted and Karen have a combined take-home income of $4,500. Their total monthly payment on consumer debt is $875. What is their debt safety ratio? Are they exhibiting any signs of approaching credit problems?

If a borrower has a high FICO score, then there is:

A person who pays off his credit balance every month should look for a credit card with a:

An individual can be overusing credit even if he or she can afford to make the minimum monthly payments on time.

Chapter 7 of the bankruptcy code:

Lenders use the guideline that a borrower's monthly repayment burden should not be more than 20% of the borrower's take-home income.

Understanding the Financial Process

Using Financial Statements and Budgets

Preparing Your Taxes

Managing Your Cash and Savings

Making Automobile and Housing Decisions

Using Consumer Loans

Insuring Your Life

Insuring Your Health

Protecting Your Property

Investment Planning

Investing in Stocks and Bonds

Investing in Mutual Funds, Etfs, and Real Estate

Planning for Retirement

Preserving Your Estate

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Exam 6: Using Credit

Which of the following is an improper use of credit?

Credit reports on individual borrowers are provided by credit card issuers.

Ted and Karen have a combined take-home income of $4,500. Their total monthly payment on consumer debt is $875. What is their debt safety ratio? Are they exhibiting any signs of approaching credit problems?

If a borrower has a high FICO score, then there is:

A person who pays off his credit balance every month should look for a credit card with a:

An individual can be overusing credit even if he or she can afford to make the minimum monthly payments on time.

Chapter 7 of the bankruptcy code:

Lenders use the guideline that a borrower's monthly repayment burden should not be more than 20% of the borrower's take-home income.

Understanding the Financial Process

Using Financial Statements and Budgets

Preparing Your Taxes

Managing Your Cash and Savings

Making Automobile and Housing Decisions

Using Consumer Loans

Insuring Your Life

Insuring Your Health

Protecting Your Property

Investment Planning

Investing in Stocks and Bonds

Investing in Mutual Funds, Etfs, and Real Estate

Planning for Retirement

Preserving Your Estate

Filters