Consumer Credit

What happens if you don't pay back money you borrowed?

• You get more money

• Nothing happens

• You might have to pay extra and it can hurt your credit

• You get a reward

In Month 1 of this loan it accounts for $1,041.50 of the payment. In Month 350, the debtor only need to pay 59.60 towards this amount. The cost of borrowing money is referred to as _______________.

Benefits of credit cards include:

• safe and convenient, bonuses are offered

• allows you to build a positive credit report

• needed for reservations and online shopping

• all of these

To build a good credit history, you should

• open as much credit as possible quickly

• use the maximum credit allowed on all your credit cards

• pay on time and as much of your balance as possible

• all of these

The maximum amount you are allowed to carry as a balance on the card

• interest

• ARP

• credit limit

• all of these

Which one is considered a danger of using a credit card

• no cash needed

• leads to overspending

• convenient

• earns rewards

What financial habits determine your credit score?

• Payment History & Amount you owe 

• Length of credit history & Amount of new credit applied for recently

• Types of credit open

• All of these are correct

What is consumer credit?

• A) A type of loan given to businesses

• B) A type of loan given to individuals for personal use

• C) A government grant for consumers

• D) A tax rebate for consumers

Which of the following is an example of consumer credit?

• A) A mortgage loan

• B) A student loan

• C) A credit card

• D) A business loan

What is the main purpose of consumer credit?

• A) To help consumers invest in stocks

• B) To allow consumers to purchase goods and services now and pay later

• C) To provide consumers with a savings account

• D) To help consumers start a business