3
QuizMultiple Choice

Credit and Loans — Test

Question 3 • Personal Finance

What is the purpose of a credit score?

Answer
A
Your credit score is the number of loans and credit cards in your credit history.
B
Your credit score helps to determine if you qualify for Chapter 7 bankruptcy.
C
Your credit score tells lenders how likely you are to make payments on time.
D
Your credit score is the result of conducting the means test evaluation.

Explanation

A credit score summarizes information about your borrowing and payment history to help lenders assess how likely you are to repay debts on time. It is not simply a count of loans and cards, nor is it the result of a bankruptcy means test. The correct choice is “Your credit score tells lenders how likely you are to make payments on time.”

AI-written and checked against the verified answer.

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