Question 1

Which of the following is not true regarding a tax refund loan?

Accepted Answer

A)  It is an inexpensive way to borrow money.
B)  It lets you get an advance on a tax refund.
C)  APRs as high as 774 percent have been reported.
D)  An alternative to these loans is to ask for more time to pay a bill.
E)  A cash advance on your credit card may cost less.

Question 2

If your credit company invites you to skip a monthly payment without a penalty:

Accepted Answer

A)  It is not doing you a favor.
B)  You will still owe finance charges on your unpaid balance.
C)  Interest could be adding up on any purchases you make after the due date you skipped.
D)  All of these are true.
E)  None of these are true.

Question 3

"Keeping up with the Joneses" is one of the frequent reasons for indebtedness.

Accepted Answer

A) True 
 B)False

Question 4

The most expensive loans are available from:

Accepted Answer

A)  parents.
B)  friends.
C)  federal savings banks.
D)  finance companies.
E)  credit unions.

Question 5

Under the rule of 78s,loans for a year or less usually do not allow for a finance charge rebate.

Accepted Answer

A) True 
 B)False

Question 6

Frank West wants to borrow money for three years to purchase a new boat.He has been offered a seven percent fixed rate loan and also a variable rate loan that has an initial rate of five percent.By choosing the variable rate loan,Chuck is:

Accepted Answer

A)  sharing the interest rate risk with the lender.
B)  increasing his monthly payments.
C)  taking a higher stake in the asset he is purchasing.
D)  repaying the loan over a faster period of time.
E)  pledging collateral.

Question 7

The Federal Trade Commission enforces the:

Accepted Answer

A)  Truth in Credit Act.
B)  Equal Credit Act.
C)  Fair Credit Receiving Act.
D)  Fair Debt Collection Practices Act.
E)  Fair Credit Payment Act.

Question 8

The most basic method of calculating interest is the compound interest calculation.

Accepted Answer

A) True 
 B)False

Question 9

You can often obtain medium-priced loans from commercial banks,federal savings banks,and credit unions.

Accepted Answer

A) True 
 B)False

Question 10

You can deduct the interest paid on consumer loans on your income tax return.

Accepted Answer

A) True 
 B)False

Question 11

You have the right to file your own bankruptcy case and represent yourself at all court hearings.

Accepted Answer

A) True 
 B)False

Question 12

The two most common methods of calculating interest are compound and simple interest formulas.

Accepted Answer

A) True 
 B)False

Question 13

Anyone who is overburdened by credit obligations can phone,write,or visit a Consumer Credit Counseling Service office.

Accepted Answer

A) True 
 B)False

Question 14

Jerrod Dean starts the month with a balance on his credit card of $1,000.On the 10th day of the month,he purchases $200 in clothes with his credit card.On the 15th day of the month he makes a payment on his credit card of $500.The bank charges 1.5 percent interest per month using the adjusted balance method.What would Jerrod's finance charges be for the month?

Accepted Answer

A)  $7.50
B)  $13.25
C)  $11.25
D)  $15.00
E)  $18.00

Question 15

Payday,cash advance,check advance,and postdated checks are _________ loans.

Accepted Answer

A)  inexpensive
B)  medium-priced
C)  expensive
D)  low APR
E)  variable APR

Question 16

Explain the two choices available in declaring personal bankruptcy.

Accepted Answer

Chapter 7 is a straight bankruptcy,and C...

Question 17

In a Chapter 7 bankruptcy,which of the following debts may be excluded from discharge?

Accepted Answer

A)  debts arising from fraud.
B)  debts arising from embezzlement.
C)  debts arising from driving while intoxicated.
D)  debts arising from larceny.
E)  All of these.

Question 18

Danger signals of potential debt problems include:

Accepted Answer

A)  paying early.
B)  borrowing money to pay old debts.
C)  talking to your spouse about money.
D)  paying extra payments.
E)  paying the balance in full each month.

Question 19

The Rule of 78s demonstrates that a borrower pays:

Accepted Answer

A)  more interest at the beginning of the loan period.
B)  more interest at the end of the loan period.
C)  more interest in the middle of the loan period.
D)  less interest than indicated by the APR.
E)  equal amounts of interest throughout the loan.

Question 20

You can often obtain medium-priced loans from:

Accepted Answer

A)  parents or family members.
B)  American Express.
C)  Diners Club.
D)  finance companies.
E)  credit unions and federal savings banks.

Exam 7: Choosing a Source of Credit: The Costs of Credit Alternatives

The Federal Trade Commission enforces the:

Correct Answer
verified

You can often obtain medium-priced loans from:

Correct Answer
verified

The most expensive loans are available from:

Correct Answer
verified

Correct Answer
verified

The two most common methods of calculating interest are compound and simple interest formulas.

Correct Answer
verified

You have the right to file your own bankruptcy case and represent yourself at all court hearings.

Correct Answer
verified

Which of the following is not true regarding a tax refund loan?

Correct Answer
verified

If your credit company invites you to skip a monthly payment without a penalty:

Correct Answer
verified

The most basic method of calculating interest is the compound interest calculation.

Correct Answer
verified

In a Chapter 7 bankruptcy,which of the following debts may be excluded from discharge?

Correct Answer
verified

Payday,cash advance,check advance,and postdated checks are _________ loans.

Correct Answer
verified

You can often obtain medium-priced loans from commercial banks,federal savings banks,and credit unions.

Correct Answer
verified

The Rule of 78s demonstrates that a borrower pays:

Correct Answer
verified

Explain the two choices available in declaring personal bankruptcy.

Correct Answer
verified
Chapter 7 is a straight bankruptcy,and C...
View Answer

You can deduct the interest paid on consumer loans on your income tax return.

Correct Answer
verified

Frank West wants to borrow money for three years to purchase a new boat.He has been offered a seven percent fixed rate loan and also a variable rate loan that has an initial rate of five percent.By choosing the variable rate loan,Chuck is:

Correct Answer
verified

Danger signals of potential debt problems include:

Correct Answer
verified

"Keeping up with the Joneses" is one of the frequent reasons for indebtedness.

Correct Answer
verified

Anyone who is overburdened by credit obligations can phone,write,or visit a Consumer Credit Counseling Service office.

Correct Answer
verified

Under the rule of 78s,loans for a year or less usually do not allow for a finance charge rebate.

Correct Answer
verified

Exam 7: Choosing a Source of Credit: The Costs of Credit Alternatives

The Federal Trade Commission enforces the:

Correct AnswerverifiedShow Answer

You can often obtain medium-priced loans from:

Correct AnswerverifiedShow Answer

The most expensive loans are available from:

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

The two most common methods of calculating interest are compound and simple interest formulas.

Correct AnswerverifiedShow Answer

You have the right to file your own bankruptcy case and represent yourself at all court hearings.

Correct AnswerverifiedShow Answer

Which of the following is not true regarding a tax refund loan?

Correct AnswerverifiedShow Answer

If your credit company invites you to skip a monthly payment without a penalty:

Correct AnswerverifiedShow Answer

The most basic method of calculating interest is the compound interest calculation.

Correct AnswerverifiedShow Answer

In a Chapter 7 bankruptcy,which of the following debts may be excluded from discharge?

Correct AnswerverifiedShow Answer

Payday,cash advance,check advance,and postdated checks are _________ loans.

Correct AnswerverifiedShow Answer

You can often obtain medium-priced loans from commercial banks,federal savings banks,and credit unions.

Correct AnswerverifiedShow Answer

The Rule of 78s demonstrates that a borrower pays:

Correct AnswerverifiedShow Answer

Explain the two choices available in declaring personal bankruptcy.

Correct AnswerverifiedChapter 7 is a straight bankruptcy,and C...View AnswerShow Answer

You can deduct the interest paid on consumer loans on your income tax return.

Correct AnswerverifiedShow Answer

Frank West wants to borrow money for three years to purchase a new boat.He has been offered a seven percent fixed rate loan and also a variable rate loan that has an initial rate of five percent.By choosing the variable rate loan,Chuck is:

Correct AnswerverifiedShow Answer

Danger signals of potential debt problems include:

Correct AnswerverifiedShow Answer

"Keeping up with the Joneses" is one of the frequent reasons for indebtedness.

Correct AnswerverifiedShow Answer

Anyone who is overburdened by credit obligations can phone,write,or visit a Consumer Credit Counseling Service office.

Correct AnswerverifiedShow Answer

Under the rule of 78s,loans for a year or less usually do not allow for a finance charge rebate.

Correct AnswerverifiedShow Answer

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
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Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified
Chapter 7 is a straight bankruptcy,and C...
View Answer

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified