Chapter 8 Quiz/Credit

What is an agreement between two parties in which one party lends money or provides goods or services to another party with the understanding that payment will be made at a later date?

• credit

• creditor

• debtor

• consumer credit

The party extending credit is known as the ________, or the lender.

• consumer credit

• creditor

• debtor

• contract

A ________________ is the creditor’s evaluation of an applicant’s willingness and ability to pay debts and is typically expressed as a letter grade

• credit report

• credit rating

• credit score

• credit bureau

A ___________________ is a numerical measure of a loan applicant’s creditworthiness at a particular point in time

• credit bureau

• low-risk borrower

• credit rating

• low-risk borrowe

A _________________________ is a responsible person who signs the loan along with the person to whom the loan is granted

• cosigner

• creditworthy

• unsecured credit

• line of credit

A ___________________ is a preapproved maximum amount that an individual can borrow

• revolving credit account

• line of credit

• open-end credit

• revolving credit account

__________________ is an agreement that allows the borrower to use a specific amount of credit over a period of time.

• low-risk borrower

• revolving credit account

• unsecured credit

• open-end credit

A ____________________ is the total amount paid by a borrower to a lender for the use of credit.

• contract

• collateral

• down payment

• finance charge

The party receiving credit is known as the __________, or the borrower.

• installment loan

• debtor

• creditor

• acceleration clause

________________ is credit granted to individual consumers by a retail business.

• consumer credit

• contract

• installment loan

• consumer credit