Final Review Economics

Where do banks get the money to lend out to consumers?

• From their clients' credit card accounts

• From their clients' savings accounts

• From the Federal government

• From their own money vaults

How do banks make money off of the credit they issue?

• They charge a large, one-time fee at the start of the loan

• They take out a small fee each month from your checking account

• They charge a high interest rate on the loan

• This is a trick question - they DON'T make money!

Which of the following is NOT a typical type of credit?

• Mortgage

• Overdraft

• Credit Card

• Pre-Paid Debit Card

What may NOT impact the interest rate on your loans?

• Your relationship with the financial institution

• Your credit score

• The loan amount

• Your level of education

True or False: A cosigner's credit history can be affected by the loan they are cosigned on.

• True

• False

Which is TRUE when you make only the minimum payment each month?

• You ar charged interest on the remaining balance

• Your credit line is restored to its maximum amount

• Credit card companies have permission to sell your information

• It is the fastest way to pay off your debt

Which is TRUE about Payday loans?

• You can pay them back in installments

• You are charged a 1-time fee for the loan

• Most people successfully pay these loans back

• You need a credit card account to get one

A shorter auto loan term means ____ monthly payments & ____ total interest you'll pay.

• higher, less

• lower, more

• higher, more

• lower, less

True or False: Landlords are required to submit your payment history, which can boost your credit score.

• True

• False

Which is FALSE about what can happen if you fail to make your mortgage payments?

• After one missed payment, you can lose your home

• You will be charged fees

• Your credit score can take a hit

• Foreclosure process starts after 30 days of missed payment