AnswersPersonal Finance - EL3403Mortgages and Home Ownership

Mortgages and Home Ownership — Unit test Answers

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21
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This table can be used to organize Gigi’s credit card balances and payments over 6 months. The annual percentage rate on the credit card is 14%.Gigi’s Credit Card PaymentsMonthBalancePaymentInterest RateInterest Charged1$650$3000.01167$4.082$354.08$500.01167 3$307.63$500.01167 4$260.64$500.01167 5$213.10$500.01167 6$165$500.01167 What is the amount of interest charged for the first 6 months?$

A
16.34
B
17.34
C
18.34
D
19.34
22
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Marcus deposited his paycheck in the amount of $625.84. He’ll use the check register to record his transaction. What will be his new balance? Do not use commas in your answer. $

Question illustration
Answer:

1266.15

23

Which is most likely to happen to consumers with good credit? Check all that apply.They can be approved for loans.They are denied a mortgage.They can receive lower interest rates.They are denied an unsecured loan.They can use credit in emergencies.They are forced into high interest rates.

A
They can be approved for loans.
B
They are denied a mortgage.
C
They can receive lower interest rates.
D
They are denied an unsecured loan.
E
They can use credit in emergencies.
F
They are forced into high interest rates.
24

A person’s credit score can range from a low of 300 to a high of what number?

Answer:

850

25

A mortgage is a legal agreement between a borrower and a

A
city agency.
B
family court judge.
C
wealthy relative.
D
bank.
26

Which information can be found on a person’s credit report? Check all that apply.

A
an unpaid utility bill that has been given to a collection agency
B
the person’s credit rating
C
the person’s yearly income
D
the person’s social security number
E
an inquiry from a bank that requested the person’s credit report
F
the person’s education level
27

Which are considered types of credit available to borrowers? Check all that apply.personal loansbondscredit cardsmortgagescashauto loansgift cards

A
personal loans
B
bonds
C
credit cards
D
mortgages
E
cash
F
auto loans
G
gift cards
28

In which column on a check register should the total current amount in the account be entered?

D
Deposit
T
Transaction
B
Balance
D
Debit
29

Borrowers taking a balloon payment mortgage most likely

A
plan to rent out their homes.
B
must repay the loan in five to ten years.
C
are unwilling to accept any risk in borrowing money.
D
remain in their homes for 30 years or more.
30

Which is considered a good credit practice?

A
Use the credit card with the highest interest rate.
B
Make late payments.
C
Pay more than the minimum amount that is due.
D
Borrow more than one can afford to repay.
31

Companies report people to credit agencies if they

A
fail to pay their bills on time.
B
borrow too much money.
C
fail to use different types of credit.
D
use large amounts of credit at once.
32

Rita has a credit card that gives a 6% discount on every purchase. The annual percentage rate on the card is 15%. She is purchasing a digital camera for $300.If she purchases the camera and only pays $80 on the first month’s bill, how much will she need to pay off the balance the following month?

A
$199.47
B
$204.53
C
$220.00
D
$222.75
33

This table can be used to organize Gigi’s credit card balances and payments over 6 months. The annual percentage rate on the credit card is 14%.Gigi’s Credit Card PaymentsMonthBalancePaymentInterest RateInterest Charged1$650$3000.01167$4.082$354.08$500.01167 3$307.63$500.01167 4$260.64$500.01167 5$213.10$500.01167 6$165$500.01167 What is the amount of interest charged for the first 6 months?$

A
16.34
B
17.34
C
18.34
D
19.34
34

The charts show the effect of an interest rate adjustment on an adjustable-rate mortgage.The change in interest rate shown in the charts resulted in

Question illustration
A
a lower interest rate.
B
a higher principal.
C
a higher monthly payment.
D
a higher number of payments.
35

Which are considered types of credit available to borrowers? Check all that apply.

A
personal loans
B
bonds
C
credit cards
D
mortgages
E
cash
F
auto loans
G
gift cards
36

Which describes the difference between a personal loan and a credit card?

A
Credit cards offer lump sums of money, while personal loans set a maximum amount a person can borrow.
B
Credit cards are secured loans for large amounts, while personal loans are unsecured for small purchases.
C
Personal loans offer lump sums of money, while credit cards set a maximum amount a person can borrow.
D
Personal loans are secured for small purchases, while credit cards are unsecured loans for large amounts.
37

Companies report people to credit agencies if they

A
fail to pay their bills on time.
B
borrow too much money.
C
fail to use different types of credit.
D
use large amounts of credit at once.
38

Which is most likely to happen to consumers with good credit? Check all that apply.

A
They can be approved for loans.
B
They are denied a mortgage.
C
They can receive lower interest rates.
D
They are denied an unsecured loan.
E
They can use credit in emergencies.
F
They are forced into high interest rates.

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