Finance Chapter 5

Home equity loans

Have interest that is tax-deductible

A typical grace period offered by many credit card issuers is

20-25 days

Which of the following can result from a failure to repay a loan?

All of the above may result from the failure to repay a loan

Which of the following is a valid reason for using credit?

All of these are valid reasons for borrowing

When misused, credit can result in

All the choices are correct

Molly purchased a $1,500 dishwasher from Best Appliances. She will make 12 equal payments over the next year to pay for it. She is using

Are based on the original purchase price of a home*B) Have interest that is tax-deductibleC) Will cause you to lose your car if the loan is not repaidD) Require you to be a member of a credit unionE) Charge high interest rates ranging from 12 to 25% {just go with it}

Installment credit, in which the debt is repaid in equal installments over a specified period of time, exploded on the American scene with the advent of the

Automobile

Perhaps the greatest disadvantage of using credit is

The temptation to overspend

Many people expect

Their incomes to increase to make it easier to make payments on past credit purchases

Which of the following is NOT correct?

Using credit cards typically provides a "float" of up to 10 days