12.14_CREDIT CHECK-IN
1. A credit card offer comes in the mail with the bold print "0% A.P.R. for New Accounts." Which
important piece of information should you find before thinking about signing up?
a. Can I get two or more cards with this offer?
b. Can I pay my credit card bill online?
c. What is the A.P.R. after the introductory period?
d. What kind of designs can I get on my card?
2. Reading through a credit card disclosure (aka the Schumer Box), you see the A.P.R. for a specific card is
set at 9.99% - 23.99%. Which of the following statements is probably TRUE?
a. When given a range of A.P.R.s like this, you can assume most cardholders pay the lowest rate
listed
b. One of the primary factors determining your card's A.P.R. is your credit score
c. With credit card A.P.R.s, cardholders like higher A.P.R.s because they earn more
d. The A.P.R. on credit cards is usually fixed so they won't be adjusted as long as you are a
cardholder
3. Which of these credit card payback strategies would result in your paying the HIGHEST amount of
interest?
a. Paying 20% of your credit card balance every month on time
b. Paying off your credit card bill in full every month
c. Making the minimum payment (3% of your credit card balance) every month on time
d. Making the minimum payment (3% of your credit card balance) every month with an occasional
late payment
CARD Statement
Account Number
1234 1234 1234 1234
Statement Closing Date
11/06/2018
Credit Line
$2,100
$1,576.80
Available Credit
TERESA TORRES
123 ANY STREET
CITY CA 12345
Account Summary
Previous Balance
$1,686.15
Credits
$0.00
Payments
$1,686.15
Purchases & Other Chgs $523.20
Cash Advances
$0.00
FINANCE CHARGE
$0.00
= New Balance
$523.20
Payment Information
New Balance
Scheduled Minimum Payment
Scheduled Payment Due Date
$523.20
$35.00
11/21/2019
12/01/2018
4. Based on the Card Statement above, which of the following statements is TRUE?
a. The cardholder is carrying a balance over from the last period.
b. The cardholder was charged interest on her balances for the last period because she made her
payment on time.
c. If the cardholder makes her minimum payment of $35.00 by the due date, she will NOT be
charged interest on her balances.
d. If the cardholder pays $523.20 by the due date on the bill, she will pay NO interest to the credit
card company.
5. Based on the Card Statement above, how much credit does this cardholder have available to use?
a. $0
b. A little more than $500
c. A little less than $1700
d. $2100
6. Which of the following statements comparing credit and debit cards is TRUE?
a. Far more businesses accept credit cards than debit cards
b. Credit cards pull money directly from your bank account, while debit cards get their money from
Visa or Mastercard
c. Credit card companies provide you with a monthly statement, while debit cards do not
d. With debit cards, you're spending your own money at point of sale, while with credit cards,
you're promising to pay back the money eventually
7. What statement about credit cards is TRUE?
a. They can help you establish a credit history
b. Since they are tied directly to your checking account, they prevent you from spending money
you do not have
c. If you need to carry a balance, the interest rates are generally quite low (less than 5%)
d. As long as you make the minimum payments it's like getting a short-term interest free loan
8. Which of the following statements is TRUE?
a. If you make the minimum payment on your card by the due date, the credit card company will
not charge you interest.
b. If you pay your balance in full after the due date, the credit card company will not charge you
interest.
c. If you pay your balance in full after the due date, you will be charged interest.
d. If you pay your balance in full by the due date, you will be charged interest.
9. Which of these statements best explains why it's often a good idea to pay more than the monthly amount
due on an amortized loan?
a. Every time you pay extra, the lender will reduce the interest rate they're charging by a small
amount.
b. The extra payment will be applied to the principal amount you owe, which will pay down your
debt more quickly.
c. The extra payment will be applied to the interest you owe, which will reduce the overall cost of
your loan.
d. Amortized loans typically have much higher interest rates than credit cards, so they're the best
place to put your extra cash.
10. If you are having trouble making credit card payments, which recommendation below represents the
LEAST useful piece of advice?
a. Find an extra source of income by taking a second job, working longer hours, or asking for a
raise
b. Stop using the credit card until you can get it paid off
c. Stop making credit card payments and wait for the credit card company to simply forget about
you
d. Reduce your overall spending so you can direct more money toward paying off your credit card