Question 1

When using credit cards,there is no way to keep track of individual expenditures.

Accepted Answer

A) True 
 B)False

Question 2

On a credit card,a finance charge is applied to

Accepted Answer

A)  any purchase. 
B)  any balance not previously paid. 
C)  current purchases. 
D)  future purchases. 
A)  any purchase. 
B)  any balance not previously paid. 
C)  current purchases. 
D)  future purchases.

Question 3

Credit cards have all of the following advantages except

Accepted Answer

A)  they allow you to borrow cash interest free for 60 days. 
B)  make purchases without carrying cash. 
C)  obtain free financing until the bill is due. 
D)  itemized monthly statement. 
A)  they allow you to borrow cash interest free for 60 days. 
B)  make purchases without carrying cash. 
C)  obtain free financing until the bill is due. 
D)  itemized monthly statement.

Question 4

You should cancel any credit card that is not sponsored by a company that sells necessities.

Accepted Answer

A) True 
 B)False

Question 5

Because of the short-term nature of credit card lending,the condition of the economy is not considered.

Accepted Answer

A) True 
 B)False

Question 6

As of November 14,Ben has an outstanding credit card balance of $1,100 from purchases made over the past month.The new billing period begins on November 15.Assume Ben's outstanding balance for the first 15 days of this new billing period (Nov.15-29)is $1,100.Then on November 29,the financial institution receives a payment of $600 from Ben,reducing his balance to $500.This is the balance for the remaining 15 days. Using the average daily balance method and a monthly interest rate of 2.5%,Ben's finance charge would be

Accepted Answer

A)  $15.00. 
B)  $12.50. 
C)  $27.50. 
D)  $20.00. 
A)  $15.00. 
B)  $12.50. 
C)  $27.50. 
D)  $20.00.

Question 7

The Consumer Financial Protection Bureau was created in 2010 to ensure that credit card companies are treated fairly.

Accepted Answer

A) True 
 B)False

Question 8

The ________ is usually about 20 days after the credit card statement is closed.

Accepted Answer

The answer of The ________ is usually about 20 days...

Question 9

Credit card companies' fees cannot exceed ________of the initial credit limit.

Accepted Answer

A)  more than 5% 
B)  more than 10% 
C)  more than 50% 
D)  more than 25% 
A)  more than 5% 
B)  more than 10% 
C)  more than 50% 
D)  more than 25%

Question 10

You are presented two choices to borrow funds for a significant unexpected expenditure.it will take at least three years to pay off the loan assuming you make more than the minimum payment.Which choice is the least cost alternative in terms of interest paid over the life of the loan?

Accepted Answer

A)  A credit card with a variable interest rate of 4 % over the prime rate; for info, the latest forecast is for prime to stay below 5% throughout the life of your loan. 
B)  An interest only balloon payment loan for 3 years with 10% interest, but your monthly payments would be half of those compared to the credit card. 
C)  There is not enough information to make the decision. 
D)  Both A and B are about equal since the interest only payment aspect offsets the slightly higher interest rate on the credit card 
A)  A credit card with a variable interest rate of 4 % over the prime rate; for info, the latest forecast is for prime to stay below 5% throughout the life of your loan. 
B)  An interest only balloon payment loan for 3 years with 10% interest, but your monthly payments would be half of those compared to the credit card. 
C)  There is not enough information to make the decision. 
D)  Both A and B are about equal since the interest only payment aspect offsets the slightly higher interest rate on the credit card

Question 11

When obtaining a credit card you should try to obtain

Accepted Answer

A)  the highest maximum limit possible. 
B)  a maximum limit high enough to cover necessary monthly purchases. 
C)  a maximum limit high enough to cover anything you might wish to purchase. 
D)  the lowest maximum limit possible to restrict your usage. 
A)  the highest maximum limit possible. 
B)  a maximum limit high enough to cover necessary monthly purchases. 
C)  a maximum limit high enough to cover anything you might wish to purchase. 
D)  the lowest maximum limit possible to restrict your usage.

Question 12

One disadvantage of a proprietary credit card is that it limits your purchases to a single merchant.

Accepted Answer

A) True 
 B)False

Question 13

Your credit card statement must state how long it will take you to pay off the existing balance due when paying only the minimum amount each month.

Accepted Answer

A) True 
 B)False

Question 14

Credit cards can eliminate the need for carrying large amounts of cash.

Accepted Answer

A) True 
 B)False

Question 15

As of November 14,Ben has an outstanding credit card balance of $1,100 from purchases made over the past month.The new billing period begins on November 15.Assume Ben's outstanding balance for the first 15 days of this new billing period (Nov.15-29)is $1,100.Then on November 29,the financial institution receives a payment of $600 from Ben,reducing his balance to $500.This is the balance for the remaining 15 days. Using the previous balance method and a monthly interest rate of 2.5%,Ben's finance charge would be

Accepted Answer

A)  $15.00. 
B)  $12.50. 
C)  $27.50. 
D)  $20.00. 
A)  $15.00. 
B)  $12.50. 
C)  $27.50. 
D)  $20.00.

Question 16

Credit cards are commonly used to pay for items such as clothing,car repairs,or a new car.

Accepted Answer

A) True 
 B)False

Question 17

All of the following are disadvantages of proprietary credit cards except

Accepted Answer

A)  your purchases are limited to a single merchant per card. 
B)  you may need several credit cards. 
C)  you receive several billing statements. 
D)  it takes considerable time to process your application to allow you to begin obtaining credit. 
A)  your purchases are limited to a single merchant per card. 
B)  you may need several credit cards. 
C)  you receive several billing statements. 
D)  it takes considerable time to process your application to allow you to begin obtaining credit.

Question 18

Describe the advantages and disadvantages of credit cards.

Accepted Answer

Advantages: take advantage of discounts

Question 19

Identifying specific goals for managing your credit is an important part of your personal financial plan.

Accepted Answer

A) True 
 B)False

Question 20

Credit has its advantages and disadvantages.Which of the following is false?

Accepted Answer

A)  Credit cards should be used with discipline. 
B)  You should spend up to the limit on all your credit cards. 
C)  Cash advances are available through a credit card. 
D)  Bankruptcy is the worst-case scenario from poor credit management. 
A)  Credit cards should be used with discipline. 
B)  You should spend up to the limit on all your credit cards. 
C)  Cash advances are available through a credit card. 
D)  Bankruptcy is the worst-case scenario from poor credit management.

When using credit cards,there is no way to keep track of individual expenditures.

On a credit card,a finance charge is applied to

Credit cards have all of the following advantages except

You should cancel any credit card that is not sponsored by a company that sells necessities.

Because of the short-term nature of credit card lending,the condition of the economy is not considered.

The Consumer Financial Protection Bureau was created in 2010 to ensure that credit card companies are treated fairly.

The ________ is usually about 20 days after the credit card statement is closed.

Credit card companies' fees cannot exceed ________of the initial credit limit.

You are presented two choices to borrow funds for a significant unexpected expenditure.it will take at least three years to pay off the loan assuming you make more than the minimum payment.Which choice is the least cost alternative in terms of interest paid over the life of the loan?

When obtaining a credit card you should try to obtain

One disadvantage of a proprietary credit card is that it limits your purchases to a single merchant.

Your credit card statement must state how long it will take you to pay off the existing balance due when paying only the minimum amount each month.

Credit cards can eliminate the need for carrying large amounts of cash.

Credit cards are commonly used to pay for items such as clothing,car repairs,or a new car.

All of the following are disadvantages of proprietary credit cards except

Describe the advantages and disadvantages of credit cards.

Identifying specific goals for managing your credit is an important part of your personal financial plan.

Credit has its advantages and disadvantages.Which of the following is false?

Overview of a Financial Plan

Planning With Personal Financial Statements

Applying Time Value Concepts

Using Tax Concepts for Planning

Banking and Interest Rates

Managing Your Money

Assessing and Securing Your Credit

Personal Loans

Purchasing and Financing a Home

Auto and Homeowners Insurance

Health and Disability Insurance

Life Insurance

Investing Fundamentals

Investing in Stocks

Investing in Bonds

Investing in Mutual Funds

Asset Allocation

Retirement Planning

Estate Planning

Integrating the Components of a Financial Plan

Filters

Exam 8: Managing Your Credit

When using credit cards,there is no way to keep track of individual expenditures.

On a credit card,a finance charge is applied to

Credit cards have all of the following advantages except

You should cancel any credit card that is not sponsored by a company that sells necessities.

Because of the short-term nature of credit card lending,the condition of the economy is not considered.

The Consumer Financial Protection Bureau was created in 2010 to ensure that credit card companies are treated fairly.

The ________ is usually about 20 days after the credit card statement is closed.

Credit card companies' fees cannot exceed ________of the initial credit limit.

You are presented two choices to borrow funds for a significant unexpected expenditure.it will take at least three years to pay off the loan assuming you make more than the minimum payment.Which choice is the least cost alternative in terms of interest paid over the life of the loan?

When obtaining a credit card you should try to obtain

One disadvantage of a proprietary credit card is that it limits your purchases to a single merchant.

Your credit card statement must state how long it will take you to pay off the existing balance due when paying only the minimum amount each month.

Credit cards can eliminate the need for carrying large amounts of cash.

Credit cards are commonly used to pay for items such as clothing,car repairs,or a new car.

All of the following are disadvantages of proprietary credit cards except

Describe the advantages and disadvantages of credit cards.

Identifying specific goals for managing your credit is an important part of your personal financial plan.

Credit has its advantages and disadvantages.Which of the following is false?

Overview of a Financial Plan

Planning With Personal Financial Statements

Applying Time Value Concepts

Using Tax Concepts for Planning

Banking and Interest Rates

Managing Your Money

Assessing and Securing Your Credit

Personal Loans

Purchasing and Financing a Home

Auto and Homeowners Insurance

Health and Disability Insurance

Life Insurance

Investing Fundamentals

Investing in Stocks

Investing in Bonds

Investing in Mutual Funds

Asset Allocation

Retirement Planning

Estate Planning

Integrating the Components of a Financial Plan

Filters