Question

Question 1 (3 points)

Match each description with the correct term.

Question 1 options:

Revolving Credit


Credit Score


Non-Installment Credit


Credit History


Credit


Installment Credit

1.
When you're approved to borrow up to a specific credit limit and you can choose how much to use and when to pay it off.

2.
One part of a credit report.

3.
Credit paid back all at once, in a single payment.

4.
A commitment to pay for something in the future.

5.
A commitment to pay back a specific amount in a specific number of equal payments.

6.
A number that tells lenders how likely you are to make payments on time.

Question 2 (3 points)
Match each description with the correct term.

Question 2 options:

Open a Bank Account


Co-Signing


Debt Settlement Program


Bankruptcy


Better Business Bureau (BBB)


Default

1.
An organization that reports on the reliability and ethics of companies and other organizations.

2.
Programs that claim they can get you out of debt by negotiating the debt to lower amounts and working out a payment plan.

3.
Legal action filed when you can't pay back creditors and puts your finances under court supervision.

4.
Failure to make a payment.

5.
The first step in establishing credit.

6.
An alternative to establishing credit if unable to get a credit card.

Question 3 (3 points)
Match each description with the correct term.

Question 3 options:

Loan


Advantages of Credit Cards


Annual Percentage Yield (APY)


Fees and Interest


Annual Percentage Rate (APR)

1.
Money you borrow from a person or organization with a commitment to pay back the amount in full.

2.
Annual interest rate that accounts for compounding.

3.
disadvantages of credit cards.

4.
Incentive programs, protection, and building credit.

5.
Annual interest rate that does not account for compounding.

Answer 1

See below each answer with its expecific explanation

Question 1 options:

Revolving Credit

Eplanation:

1. When you're approved to borrow up to a specific credit limit and you can choose how much to use and when to pay it off.

Credit Score

Eplanation:

6. A number that tells lenders how likely you are to make payments on time.

Non-Installment Credit

Eplanation:

3. Credit paid back all at once, in a single payment.

Credit History

Eplanation:

2. One part of a credit report.

Credit

Eplanation:

4. A commitment to pay for something in the future.

Installment Credit

Eplanation:

5. A commitment to pay back a specific amount in a specific number of equal payments.

Question 2 options:

Open a Bank Account

Eplanation:

5. The first step in establishing credit.

Co-Signing

Eplanation:

6. An alternative to establishing credit if unable to get a credit card.

Debt Settlement Program

Eplanation:

2. Programs that claim they can get you out of debt by negotiating the debt to lower amounts and working out a payment plan.

Bankruptcy

Eplanation:

3. Legal action filed when you can't pay back creditors and puts your finances under court supervision.

Better Business Bureau (BBB)

Eplanation:

1. An organization that reports on the reliability and ethics of companies and other organizations.

Default

Eplanation:

4. Failure to make a payment.

Question 3 options:

Loan

Eplanation:

1. Money you borrow from a person or organization with a commitment to pay back the amount in full.

Advantages of Credit Cards

Eplanation:

4. Incentive programs, protection, and building credit.

Annual Percentage Yield (APY)

Eplanation:

2. Annual interest rate that accounts for compounding.

Fees and Interest

Eplanation:

3. disadvantages of credit cards.

Annual Percentage Rate (APR)

Eplanation:

5. Annual interest rate that does not account for compounding.