Borrowing/Credit

Credit means to _____ money to make a large purchase.

• borrow

• steal

• earn

A ______ is the person or group who loans someone money.

• lender

• borrower

A ______ is the person who is receiving money to help pay for something.

• lender

• borrower

Which of the following is a true statement?

• When you borrow money you do not have to pay any of it back.

• When you borrow money you only have to pay back some of the money.

• When you borrow money you have to pay it all back, plus interest.

Which of the following is a reason someone might need to borrow money?

• For a large purchase (house, car)

• For an emergency (doctor, car repair)

• For the future (college)

• All of these!

Shay borrowed $500 to fix her car. She ended up paying the bank $550 back. Why did Shay pay the bank back more money than she borrowed?

• Shay forgot how much she had borrowed.

• Shay had to pay interest on the money she borrowed.

• Shay wanted to give the bank a gift for being nice.

If you do not pay back your loan, money borrowed, the bank will take the items back?

• True

• False

Credit is free money!

• True

• False

Extra money that you might owe a lender when you use credit is called...

• a gift.

• interest.

• a budget.

Which is an example of credit?

• Craig earns $100 a week mowing lawns.

• Kayla spent $75 on new shoes.

• Ruby puts away $20 each week in her piggy bank.

• Drake borrowed $200 to fix a flat tire.