Credit Card
What is the term for the maximum amount you can spend on a credit card?
A. Credit score
B. Credit limit
C. Credit balance
D. Credit payment
Answer: B. Credit limit
Which of these does NOT affect your credit score?
A. Your age
B. Your payment history
C. Your credit utilization
D. Length of credit history
A. Your age
What is a down payment on a car?
A. The monthly payment you make on a loan
B. The initial payment you make when buying a car
C. The total cost of the car
D. The interest rate on the loan
B. The initial payment you make when buying a car
What are federal student loans?
A. Loans offered by private banks
B. Loans funded by the federal government
C. Scholarships you don’t have to repay
D. Loans only for graduate students
B. Loans funded by the federal government
What does "gross income" mean?
A. Your income after taxes and deductions
B. Your total income before taxes and deductions
C. The income you receive in cash
D. The income from side jobs
B. Your total income before taxes and deductions
What happens if you only pay the minimum payment on your credit card bill?
A. Your credit score increases
B. Your balance is completely paid off
C. You accrue interest on the remaining balance
D. You avoid paying any fees
C. You accrue interest on the remaining balance
What is considered a “good” credit score?
A. 300-499
B. 500-649
C. 650-749
D. 750-850
C. 650-749
What is the interest rate on an auto loan based on?
A. The car’s color
B. Your credit score
C. The size of the down payment
D. The car’s age
B. Your credit score
What is the difference between subsidized and unsubsidized student loans?
A. Subsidized loans are paused during school, unsubsidized loans are not
B. Subsidized loans are more expensive
C. Unsubsidized loans are only for specific colleges
D. Subsidized loans have no interest
A. Subsidized loans are paused during school, unsubsidized loans are not
Which of the following is NOT a common deduction from an employee's paycheck?
A. Taxes
B. Insurance premiums
C. Rent payments
D. Retirement contributions
C. Rent payments
What is the fee called when you use your credit card for a cash withdrawal?
A. Annual fee
B. Balance transfer fee
C. Late payment fee
D. Cash advance fee
D. Cash advance fee
What happens if you apply for too many credit cards in a short period?
A. Your credit score increases
B. Your credit score decreases due to hard inquiries
C. Your credit score stays the same
D. You automatically get denied
B. Your credit score decreases due to hard inquiries
You want to buy a car that costs $24,000. If the dealer requires a $7,000 down payment, how much will you need to finance with a loan?
A. $16,000
B. $19,000
C. $17,000
D. $15,000
C. $17,000
Why might some people struggle to repay student loans after graduation?
A. They didn’t graduate
B. Their income is too low compared to their loan payments
C. They have multiple bank accounts
D. They forgot about their loans
B. Their income is too low compared to their loan payments
What does "net income" mean?
A. Your income after taxes and deductions
B. Your total income before taxes and deductions
C. Your side income only
D. Your savings from your paycheck
A. Your income after taxes and deductions
What is the APR, and why is it important for credit cards?
A. Average Percentage Rate; it shows your credit limit
B. Annual Percentage Rate; it determines the interest you pay on unpaid balances
C. Annual Payment Requirement; it’s your yearly fee for using a credit card
D. Approved Payment Rate; it’s the minimum payment required each month
B. Annual Percentage Rate; it determines the interest you pay on unpaid balances
Which factor has the biggest impact on your credit score?
A. Payment history
B. Length of credit history
C. Types of credit used
D. Number of credit inquiries
A. Payment history
What happens if you miss too many car loan payments?
A. Your interest rate increases
B. The lender may repossess your car
C. The loan payments stop automatically
D. The lender increases your loan balance
B. The lender may repossess your car
Which type of student loan does NOT accrue interest while you’re in school?
A. Private loans
B. Federal subsidized loans
C. Federal unsubsidized loans
D. Parent PLUS loans
B. Federal subsidized loans
What is the purpose of a W-4 form?
A. To calculate your tax refund
B. To determine how much tax to withhold from your paycheck
C. To apply for a loan
D. To report your total income to your employer
B. To determine how much tax to withhold from your paycheck
What does it mean to “default” on your credit card?
A. You pay off your balance early
B. You fail to make the required payments
C. You close the credit card account
D. You request a credit increase
B. You fail to make the required payments
What is the credit utilization ratio?
A. The percentage of available credit you’re using
B. The number of credit cards you have
C. The amount of credit you pay off each month
D. The total balance on all your cards
A. The percentage of available credit you’re using
What is the typical loan term for an auto loan?
A. 6-12 months
B. 1-2 years
C. 3-7 years
D. 8-10 years
C. 3-7 years
What does loan forgiveness mean for student loans?
A. The loan balance is transferred to a family member
B. The lender cancels some or all of your loan balance
C. You can skip payments for a year without penalty
D. The loan term is automatically extended
B. The lender cancels some or all of your loan balance
What is overtime pay typically calculated as?
A. Regular hourly wage
B. Half your hourly wage
C. Time and a half your hourly wage
D. Double your hourly wage
C. Time and a half your hourly wage