Miscellaneous
Which of the following is NOT considered a transaction on a credit card statement?
a. payments made b. fees charged by the card company
c. the statement closing date d. customer purchases and returns
C
Money borrowed to pay off all of your debt is a what?
Consolidation Loan
The for cash advances and balance transfers is typically higher than the rate for purchases.
APR/ Periodic Finance Charge/ Periodic Rate
What is a document from the credit card company which outlines the costs associated with using their card
Credit Terms & conditions
What is NOT a benefit of a credit card?
A. Rewards
B. Ability to improve Credit Score
C. Low interest rates
D. Extra funds for emergencies
C
Which of the following reasons might be used to discourage a friend from getting a cash advance on a credit card?
a. interest charges begin accumulating immediately
b. payments are applied to any purchase balance before the cash advance balance creating higher finance charges
c. the interest rate for cash advances is higher than for purchases
d. all of the above
D
Callie Brent’s credit card statement for March 31 showed a previous balance of $110.40 and new purchases of $22.31 on 3/11, $12.11 on 3/18, and $34.85 on 3/23. She made a payment of $90.40 on 3/27. What is Callie’s new balance?
$89.27
What includes both the periodic finance charges and the fees that are charged.
Total Finance Charge
Which of the following is the most common method for calculating finance charges on a credit card?
(Think of what benefits the credit card company most)
a. adjusted balance method
b. The interest balance method
c. mean balance method
d. previous balance method
D
When comparing credit cards, all the following should be evaluated before making a decision with the exception of
a. the annual percentage rate.
b. the credit limit available.
c. the method used for calculating finance charges.
d. the annual fees assessed.
B
Michelle Peterson’s credit card statement for the month of December showed a membership fee of $50, a late fee of $25, a finance charge of $20.72, and an over-the-limit fee of $24. What was the total cost of the card to Michelle in December?
$119.72
What is a number generated by credit bureaus to assess the risk an individual poses to a creditor?
Credit Score
Which of the following best describes how to calculate a monthly periodic rate?
a. Divide the APR by twelve and write as a decimal.
b. Multiply the finance charge by twelve and write as a decimal.
c. Multiply the APR by the number of days in the month and write as a decimal.
d. Multiply the APR by twelve and write as a decimal.
A
Which of the following is NOT a strategy for managing or reducing debt?
a. Use a debit card instead of cash.
b. Transfer high interest credit card balances to lower interest accounts.
c. Pay more than the minimum payment on credit cards.
d. Pay off credit cards with the highest interest rates first.
A
Julie has a credit card that has an APR of 21% applied at a daily periodic rate using the previous balance method. Her previous balance was $637.31. She made new purchases totaling $183.92 and a payment of 95.00 this month. What is her finance charge and new balance?
Finance Charge: $11.00
New Balance: $737.23
DAILY DOUBLE!! Money borrowed on a credit card and received in cash is called a what?
Cash Advance
Michael Lane checked his credit card statement and noticed a sale for $28.99 that was unauthorized. He also found that a sale for $52.87 had been listed as $58.27. If the new balance on his statement was $410.65, what is his correct new balance?
$376.24
Blake earns $2,100 each month. He pays $700 per month for housing, $250 per month for a car loan, and $175 per month in other debt payments. Find Blake’s debt-to-income ratio to the nearest tenth of a percent.
53.6%
DAILY DOUBLE!! Kurt borrowed $350 for 18 days on his credit card using a cash advance. His credit company charged a cash advance fee of $12 and a daily periodic interest rate of 0.054%. What was the total finance charge on the cash advance?
$15.40
The method that calculates the balance subject to finance charges by subtracting payments and credits from the previous balance is called the what?
Adjusted Balance Method