Chapter 16 test
______ is a line of credit granted from one business to another for a short period of time to purchase its goods and services.
trade credit
Money lenders and credit card companies are required by the federal ______ Act to state the APR of loans when they advertise a rate.
truth and lending
______ credit is credit granted based on a signed credit agreement alone.
unsecured
A written set of guidelines used by an organization to determine how many and which customers will be approved for credit is a ______.
credit policy
A ______ is a record of credit history and financial behavior for a business or individual.
credit report
A ______ is a numerical measure of a loan applicant's creditworthiness at a particular point in time.
credit score
The party extending credit is known as the ______.
creditor
______ is the continues and regular patronage of a business even when there are other places to purchase the same or similar products.
customer loyalty
A(n) _____ is the total amount paid by a borrower to a lender for the use of credit.
finance charge
A(n) ______ loan is a loan for a specific amount of money that is repaid with interest in regular installments.
installment
A(n) ______ loan is a loan for a specific amount of money that is repaid with interest in regular payments.
installment
The ______ represents the cost of a loan and is expressed as a percent of the amount borrowed.
interest rate
A(n) ______ is a schedule that shows the amount of interest and principal for each payment so a loan can be repaid within a specific period of time.
open-end credit
______ is an agreement that allows the borrower to use a specific amount of credit over a period of time.
open-end credit
A ______ credit card is one that can only be used only in the stores of the company that issued it.
proprietary
A(n) _____ credit account does not automatically close when the balance is paid off.
revolving account
Credit loans that require collateral are known as ______ credit.
secured
______ is a formula based on the principal, interest rate, and length of time of a loan.
simple interest
Criteria used to evaluate the creditworthiness of consumer credit applicants, which includes character, capacity, and capital, are called the ______.
3 C's of credit
Criteria lenders use to evaluate the creditworthiness of businesses, including cash flow, capacity, collateral, and conditions, are called the _____.
5 C's of banking
Credit granted to individual consumers by a retail business is ______ credit.
consumer
______ credit is credit granted to individual consumers by a retail business.
consumer
Credit granted to a business by a financial institution or another company is _____ credit.
business
______ credit is credit granted to a business by a financial institution or another company.
business
A loan for a specific amount that must be repaid with interest by a specified date or according to a specified schedule is called ______.
closed-end credit