Consumer Credit 7100

To avoid paying interest, credit card holders should pay for their goods

• at the time of purchase

• before a date given on the monthly statement

• two months after the purchase date

• when their goods arrive

Which statement explains why retailers offer credit to consumers?

• to decrease retailers' costs

• to decrease consumers' income

• to increase consumers' debts

• to increase retailers' sales

Which question is most important for a customer considering buying goods on credit?

• are the goods fit for the purpose?

• do the goods represent value for money?

• what discount will be given by the retailer?

• what is the difference between cash price and credit price?

What is a disadvantage to the buyer of buying a television on credit?

• a credit check will be made by the seller

• interest may be charged by the seller

• payment is postponed until a later date

• there is no need to carry a large amount of cash when buying

Susan buys a jacket using a credit sales agreement. The cash price is $290. Susan pays $50

deposit and the rest of the debt, on which 10% interest is charged, in 12 equal monthly instalments.

What will be the total credit sales price?

• $266

• $290

• $314

• $340

When making hire purchase transactions, which of the following is used?

• a building society

• a commercial bank

• a finance company

• a stock exchange

A method of credit in which a shopkeeper keeps goods ordered for collection at the end of the week

is known as

• credit sales

• credit transfer

• deferred credit

• lay-by

Suleiman has received his credit card statement which contains the following information.

What is

the best way for Suleiman to avoid paying any interest on his credit card?

• pay $750 after 21 October

• pay $2000 before 21 October

• pay $2250 after 21 October

• pay $2250 before 21 October

A computer is offered for sale by cash or by hire purchase on the following terms.

How much more will the customer pay if she buys the computer using hire purchase?

• $130

• $400

• $480

• $530

How does buying on credit contribute to a country’s standard of living?

• consumers are able to buy what they want or need

• many people accumulate large amounts of debt

• more goods will be imported for sale

• people will save less of their income