Credit and Loans

Question 1

What is a benefit of obtaining a personal loan?

Revolt · Accepted Answer

getting money with special repayment terms

Question 2

The type of credit people are most likely to use for small purchases during their lifetime is

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a credit card.

Question 3

The chart shows a range of credit scores.

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find it hard to get a loan.

Question 4

Which describes an example of using unsecured credit?

Revolt · Accepted Answer

Someone buys new gutters for a home with a credit card.

Question 5

What best determines whether a borrower’s interest rate on an adjustable rate loan goes up or down?

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a market's condition

Question 6

What is the compound interest on a three-year, $100.00 loan at a 10 percent annual interest rate?

Revolt · Accepted Answer

$33.10

Question 7

Which describes the difference between simple and compound interest?

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Simple interest is paid on the principal, while compound interest is paid on the principal and interest accrued.

Question 8

In determining whether to issue a loan, banks are not allowed to ask about an applicant’s

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country of origin.

Question 9

Read the scenario.Casey has been saving for a new car and is ready to make a purchase. Having a substantial amount to put down as a down payment, Casey approaches the car dealership. The salesperson and the loan officer view Casey's willingness to make a high down payment positively.Why would Casey be considered a lower risk by the lender for planning to make a high down payment?

Revolt · Accepted Answer

It shows that Casey is committed to paying off the loan.

Question 10

Which describes the difference between secured and unsecured credit?

Revolt · Accepted Answer

Secured credit is backed by an asset equal to the value of a loan, while unsecured credit is not guaranteed by a material object.

Credit and Loans Answers

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