Credit Card Knowledge Quiz

What does APR stand for?

• Annual Percentage Rate

• Average Percentage Rate

• Annual Payment Rate

• Average Payment Rate

What is a credit score used for?

• To determine eligibility for loans

• To calculate monthly expenses

• To assess job performance

• To evaluate health status

Which of the following is a benefit of having a good credit score?

• Lower interest rates on loans

• Higher interest rates on savings

• Increased loan rejection

• Higher insurance premiums

What is the main purpose of a credit card?

• To provide a line of credit for purchases

• To store personal information

• To serve as a form of identification

• To earn interest on savings

How often is interest typically charged on a credit card balance?

What is the consequence of missing a credit card payment?

• Increased credit score

• Late payment fee

• Lower interest rate

• Extended credit limit

Why is it important to check your credit report regularly?

• To detect identity theft early

• To increase your credit score automatically

• To avoid paying taxes

• To ensure your bank account balance is correct

What is one way to improve your credit score?

• Paying bills on time

• Ignoring credit card payments

• Maxing out credit cards

• Closing old credit accounts

How does a high APR affect the cost of borrowing?

• It increases the cost of borrowing.

• It decreases the cost of borrowing.

• It has no effect on the cost of borrowing.

• It makes borrowing free.

What is a potential risk of using a credit card irresponsibly?

• Accumulating debt

• Improving credit score

• Earning rewards

• Increasing savings