AnswersTCHS VV Financial Math ASimple Interest

Understanding Credit Answers

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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.
2
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Before giving a loan to a customer, a lender examines the customer’s credit report. Which explains why the lender examines the customer’s credit report?

A
to determine if the customer is a likeable person
B
to determine the customer’s income
C
to determine the customer’s job title
D
to determine if the customer is likely to pay back the loan
3

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.
4

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.
5

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.
6

Dahlia is explaining to her sister why a positive credit history is important. Which of the following should Dahlia give as reasons for a positive credit history? Check all that apply.

A
A good credit history portrays irresponsibility.
B
A good credit history results in lower interest rates.
C
A good credit history makes borrowing easier.
D
A good credit history results in higher interest rates.
E
A good credit history may result in denial of a rental application.
7

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.
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

Isabella bought a CD player at the store. She will receive the bill at the end of the month. She plans to pay $30 each month until the bill is paid in full. How did Isabella pay for the CD player?

A
cash
B
check
C
credit card
D
debit card
10

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

A
to determine which company has the best credit card features
B
to determine if he has a history of good credit
C
to determine if he needs a credit card
D
to determine his credit limit

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