AnswersOCPS -2102371-Personal Finance and Money ManagementUnit Test

Understanding Credit Answers

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1
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Simon used a credit card to buy a skateboard. Which statement is true about his method of payment?

A
Simon paid cash at the store.
B
Simon used money directly from his bank account.
C
Simon will receive the bill later.
D
Simon made the purchase with money he saved.
2
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Lois bought clothing at a store. She did not have enough in her bank account to pay for the purchase. After receiving the bill and paying off the balance, she realized that she paid $9.69 in interest. Which statement is true about her method of payment?

L
Lois used a debit card to make the purchase.
L
Lois used a credit card to make the purchase.
L
Lois either used a debit card or used a credit card and paid the balance in full when the bill arrived.
L
Lois either used a debit card or used a credit card and made a single payment.
3

Kenya used a debit card to buy a pair of jeans. Which statement is true about her method of payment?

K
Kenya used money directly from her bank account to buy the jeans.
K
Kenya borrowed the money to buy the jeans.
K
Kenya did not have enough money in her bank account to buy the jeans.
K
Kenya will pay for the jeans over time.
4

Yoko is buying a car from a local car dealership. She wants to get the lowest interest rate possible. Which will most likely help her get the lowest interest rate?

a
asking nicely
m
making sure she has a positive credit history
e
explaining that she has many outstanding loans
s
showing her driver’s license
5

Kendrick is planning to buy a house. Which explains why he should establish a positive credit history before buying the house?

A
He will get the house for a lower price.
B
It will be easier for him to get a loan to buy the house.
C
He will be able to get a higher interest rate when buying the house.
D
He will be able to find a house he likes more quickly.
6

Before applying for a credit card, Jacob examines his credit report. Which explains why Jacob might examine his credit report?

t
to determine which company has the best credit card features
t
to determine if he has a history of good credit
t
to determine if he needs a credit card
t
to determine his credit limit
7

Xavier buys a computer for $525, which includes taxes. He pays for the computer over a 12-month period by paying $48.13 per month. Which statement about Xavier’s purchase is most likely true?

A
He used a debit card to make the purchase and paid exactly $525 for the computer.
B
He used a debit card to make the purchase and paid an additional $52.56 in interest.
C
He used a credit card to make the purchase and paid exactly $525 for the computer.
D
He used a credit card to make the purchase and paid an additional $52.56 in interest.
8

A lender is assessing customers for loans. The credit scores of four customers are below.IdaCorrineBruceRoland820550390610Which person will the lender assess as having the lowest risk?

A
Ida
B
Corrine
C
Bruce
D
Roland
9

Fido wants to buy a new car. He will need to get a car loan. Fido decides to wait for a few months until his credit history improves. Which explains whether Fido is making a sensible decision?

A
Fido’s decision is sensible because the selling price of the car should be less in a few months.
B
Fido’s decision is sensible because the cost of the car loan should be less if his credit history improves.
C
Fido’s decision is not sensible because he needs the car right away.
D
Fido’s decision is not sensible because it does not matter if he buys the car now or in a few months.
10

Quincy wanted his credit report. Which list could Quincy have obtained?

p
previous address, current address, bankruptcy, car loan payment history
c
current address, monthly income, car loan payment history, date of birth
p
previous address, current address, schools attended, bankruptcy
c
current address, monthly income, car loan payment history, schools attended
11

Tamera and Rupert each applied for the same credit card through the same company. Tamera has a positive credit history. Rupert has a negative credit history. Which compares their credit limits and likely interest rates?

A
Tamera’s credit limit is most likely higher than Rupert’s, and her interest rate is most likely lower.
B
Tamera’s credit limit is most likely lower than Rupert’s, and her interest rate is most likely higher.
C
Rupert’s credit limit is most likely higher than Tamera’s, and his interest rate is most likely lower.
D
Rupert’s credit limit is most likely lower than Tamera’s, and his interest rate is most likely lower.
12

Kenya used a debit card to buy a pair of jeans. Which statement is true about her method of payment?

A
Kenya used money directly from her bank account to buy the jeans.
B
Kenya borrowed the money to buy the jeans.
C
Kenya did not have enough money in her bank account to buy the jeans.
D
Kenya will pay for the jeans over time.
13

Which helps to establish a negative credit history?

A
Make payments on or before the due date.
B
Never miss a payment.
C
Pay off the full amount with the first monthly statement.
D
Pay less than the minimum amount due.
14

Xavier buys a computer for $525, which includes taxes. He pays for the computer over a 12-month period by paying $48.13 per month. Which statement about Xavier’s purchase is most likely true?

A
He used a debit card to make the purchase and paid exactly $525 for the computer.
B
He used a debit card to make the purchase and paid an additional $52.56 in interest.
C
He used a credit card to make the purchase and paid exactly $525 for the computer.
D
He used a credit card to make the purchase and paid an additional $52.56 in interest.
15

Yoko is buying a car from a local car dealership. She wants to get the lowest interest rate possible. Which will most likely help her get the lowest interest rate?

A
asking nicely
B
making sure she has a positive credit history
C
explaining that she has many outstanding loans
D
showing her driver’s license
16

Fido wants to buy a new car. He will need to get a car loan. Fido decides to wait for a few months until his credit history improves. Which explains whether Fido is making a sensible decision?

A
Fido’s decision is sensible because the selling price of the car should be less in a few months.
B
Fido’s decision is sensible because the cost of the car loan should be less if his credit history improves.
C
Fido’s decision is not sensible because he needs the car right away.
D
Fido’s decision is not sensible because it does not matter if he buys the car now or in a few months.
17

Pete is trying to get a loan. He has a credit score of 480. How is Pete’s lender likely to view this credit score?

A
Pete is responsible and will pay the loan back on time.
B
Pete is responsible but will not pay the loan back on time.
C
Pete is irresponsible but will pay the loan back on time.
D
Pete is irresponsible and will not pay the loan back on time.
18

Tyler is using a credit card to purchase a television. Which of the following should Tyler expect? Check all that apply.

A
to have the full amount available in his bank account right away
B
to receive a bill at a later date
C
to be able to pay for it over time
D
to write a check
E
to pay interest if he does not pay in full by a certain date
19

Which information is found on a credit report?

A
grade point average
B
list of schools attended
C
names of family members
D
credit account history
20

Kendrick is planning to buy a house. Which explains why he should establish a positive credit history before buying the house?

A
He will get the house for a lower price.
B
It will be easier for him to get a loan to buy the house.
C
He will be able to get a higher interest rate when buying the house.
D
He will be able to find a house he likes more quickly.

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