UGBA 196 - Assignment 1

what % of college undergrads has at least one credit card

75%

If the credit card issuer notifies you of a significant change in terms, and you do NOT want to accept them, your options include: A. Increase monthly payments so balance will be paid in five years. B. Double percentage of minimum payment. C. Close account by paying off balance. D. Any of the above.

D. Any of the above.

When a new credit card account is opened, there can be no interest rate increase for 12 months unless: A. You are more than 60 days late with a payment. B. You are on a variable interest rate tied to an index. C. An introductory rate has expired. D. Any of the above.

D. Any of the above.

The best way to establish credit is to A. Not borrow money B. Pay cash for everything C. Write checks for everything and keep accurate records D. None of the above

D. None of the above

To protect from fraud and identity theft A. Always carry your Social Security card or number with you B. Use Wi-Fi hot spots for e-banking transactions C. Do not sign out of public computers. D. None of the above.

D. None of the above

To be come a millionaire ("financially independent") in today's dollars, it is required for a household to have an annual income of at least: A. $200,000 B. $250,000 C. $400,000 D. None of the above.

D. None of the above.

Which of the following statements about Social Security is true? A. Social security still collects more than it pays out. B. Reduced benefits for early retirement are available at age 55. C. Social Security benefits are exempt from federal taxes. D. None of the above.

D. None of the above.

Video: Which of the following should be a higher priority? A. All three should have the same priority B. Paying off your mortgage as soon as possible C. Paying off student debt as soon as possible D. Paying off credit card debt as soon as possible

D. Paying off credit card debt as soon as possible

Which is the best way to conclude a contract? A. Agree orally B. Shake hands C. Make promises D. Sign a written agreement

D. Sign a written agreement

Video: Which is NOT recommended in the video on spending for happiness? A. Buy small treats to which you haven't become accustomed B. Invest in others C. Buy time D. Spend now pay later

D. Spend now pay later

Which is the best place to use a credit card? A. Bars. B. Pawn shops. C. Tired re-tread shops. D. Super market.

D. Super market

A balance transfer fee may be charged when you transfer a balance from one credit card provider to another

True

A certified check is a personal check guaranteed by a bank

True

A credit card grace period may NOT apply to cash advances or balance transfers

True

A person with an obligation to repay a loan is a "debtor"

True

A secured debit card takes money out of your bank account, but does NOT necessarily help you establish credit

True

A variable rate of interest is now commonly used by credit card issuers

True

Banks may waive over the limit fees and late penalties the first time if you ask

True

Because of the hacking of business and government data centers, a security freeze on your account may be a good idea

True

Beware of "credit repair" companies who charge upfront fees for credit advice

True

Credit card statements must include a toll free number you can call for credit counseling

True

Every time a credit or debit card is used, a transaction fee is paid by the merchant to the card issuing bank

True

For an account in good standing interest rate increases can only apply to new charges NOT prior balances

True

For an account in good standing, interest rate increases can only apply to new charges, NOT prior balances even if there are current changes in a credit report or a credit score

True

Fraud may void an entire contract

True

If you are more than 60 days late in making minimum payment the issuer may charge you the interest default rate

True

If you borrow money you should know how you're going to pay it back

True

If you carry a credit card balance there may be different interest rates charged for cash advances and purchases

True

Interest on payday loans can legally exceed 300%

True

It's best not to use a debit card for hotels or car rentals because they will probably put a hold on your account

True

Longevity has replaced retirement as a major social economic issue

True

The information on your credit report determines your credit score

True

Video: If a credit card is in your spouse's name and you did NOT co-sign, the payment history on that card will NOT affect your credit score

True

Video: If you've been turned down for a job because of your credit report, the potential employer is requirement to tell you the name of the credit bureau that it used

True

Video: Social Security benefits are adjusted for the cost of living

True

When a party does NOT adhere to a term or condition of a contract it is considered breached

True

You do NOT pay Social Security taxes on interest you earn

True

Your loss due to credit card theft is limited to $50 if reported within two days of discovery

True

Under the "card act" the interest default rate may NOT exceed 35%

False

Video: Buying tangible objects usually makes us happier than buying experiences

False

Video: Lenders are NOT allowed to consider how long you have lived in the same house or apartment

False

To avoid a late payment fee, if paying by mail the payment must be A. Postmarked by the due date B. Received by the due date C. Mailed by the due date D. None of the above

B. Received by the due date

Which of the following is important when signing a contract? A. What is the reputation of the other parties? B. Is mediation or arbitration required? C. What constitutes the end of the contract? D. All of the above.

D. All of the above.

Which of the following is NOT a prepaid card fee? A. Activation fee. B. Monthly maintenance fee. C. Load money onto the card fee. D. Annual fee.

D. Annual fee

what is the average credit card balance owed by college undergrads

$3000

Nationally what percentage of students who start high school do NOT graduate?

30%

The annual rate of interest is the same as the APR

False

In terms of annual income, to be in the top 1% of households, annual earnings should exceed about: A. $400,000 B. $113,000 C. $160,000 D. $250,000

A. $400,000

Video: Ida May Fuller, the first Social Security recipient, collected $22,888.98 in Social Security benefits. How much had she contributed in payroll taxes? A. About $25 B. About $25,000 C. About $2,500 D. About $250

A. About $25

Which of the following is NOT a good use of debt? A. Borrowing money for a vacation. B. Investing in a well thought out business. C. An affordable home loan. D. An affordable car loan.

A. Borrowing money for a vacation.

Interest in a credit card account is normally calculated: A. Daily. B. Weekly. C. Bi-monthly. D. Yearly.

A. Daily

Which of the following is NOT a major credit reporting agency? A. Discover B. Transunion C. Equifax D. Experian

A. Discover

Which of the following is NOT subject to a credit card fee? A. Early payment fee. B. Foreign exchange transaction fee. C. Cash advance fee. D. Return check fee.

A. Early payment fee.

Which of the following is NOT true? A. Involuntary requests to see your credit report may be made by rental car companies. B. An employer must have your written permission to access your credit report C. Voluntary requests to see your credit report are authorized you D. A landlord cannot see your credit report without your approval

A. Involuntary requests to see your credit report may be made by rental car companies

Video: Which of the following are NOT allowed to check credit scores? A. None of the above B. Insurance companies C. Landlords D. Employers

A. None of the above

When entering into a contract, which is NOT important? A. The contract being witnessed by a lawyer. B. What happens if any party fails to perform? C. All blanks should be filled. D. What constitutes the end of the contract?

A. The contract being witnessed by a lawyer.

Video: Advice varies on which debt to pay off first. Which of the following is NOT a recommended choice? A. The debt with the lowest interest rate B. The debt with the highest interest rate C. The smallest debt D. The debt that bothers you most

A. The debt with the lowest interest rate

The legal limit on interest applied to unpaid credit card balances is: A. There is no limit B. 28% C. 35% D. 37%

A. There is no limit

Video: Credit reports can include information about: A. Whether you filed for bankruptcy in the last 10 years B. What items you bought with a credit card C. All of the above D. Your checking accounts

A. Whether you filed for bankruptcy in the last 10 years

The most important part of your credit report is credit score

False

To alert you to possible identity the ft the IRS will email or call

False

To avoid a late payment penalty fee when paying by mail it must be postmarked no later than 5pm on the due date

False

We define "wealth" as A. 10 times the poverty level B. Lifestyle C. Annual income over $100,000 D. Net worth in excess of $1,000,000

B. Lifestyle

Social Security is a A. Federal pension plan B. Pay as you go plan C. A privately insured pension plan D. None of the above

B. Pay as you go plan

Fees for inactivity, loading money, monthly maintenance, and checking balance are common to A. Debit cards B. Prepaid cards C. Credit cards D. None of the above

B. Prepaid cards

Of all the money the government spends, approximately what % is spent on senior citizens? A. 20% B. 40% C. 50% D. 30%

B. 40%

The range of a subprime FICO score is about A. 300-499 B. 620-660 C. 500-559 D. 560-619

B. 620-660

Which of the following does NOT apply to Medicare Part B and Part D A. The monthly payments of those covered are "means tested" B. Additional costs are covered by payroll taxes capped at $117,500 or Social Security payroll taxes C. Membership is optional D. Coverage is not 100%

B. Additional costs are covered by payroll taxes capped at $117,500 or Social Security payroll taxes

A credit card "hold" is limited to A. $200 B. An arbitrary amount C. $500 D. Two times the expected charge

B. An arbitrary amount

The fee charged by the new provider when you transfer balance from one credit card to another is called a A. New card fee B. Balance transfer fee C. Transfer debt fee D. Balance debt fee

B. Balance transfer fee

The "cornerstone" of wealth is A. Not giving to charity B. Being frugal C. Being cheap D. Obsessive thrift

B. Being frugal

A credit card fee may be charged for: A. Universal default. B. Late payment/closing account. C. Double cycle billing, D. Having a grace period.

B. Closing an account or late payment

Which is NOT "consideration" when creating a contract? A. Money. B. Gender. C. Physical objects. D. Services.

B. Gender.

It is estimated that seniors take out in Social Security and Medicare benefits an amount equal to A. Four times what they paid in B. Six times what they paid in C. Less than they paid in D. Two times what they paid in

B. Six times what they paid in

Avoid the following credit card mistake. A. Using it pay for a hotel room. B. Using it to withdraw cash from an ATM. C. Using it to rent a car. D. Using it to purchase a song on iTunes.

B. Using it to withdraw cash from an ATM.

Which of the following is NOT a method of identity theft? A. You receive an email from your bank asking you to update your account information including you social security number. B. Your credit card statement has a charge on it you do not recognize. C. Mail has been stolen from your mailbox. D. Your wallet or purse is stolen.

B. Your credit card statement has a charge on it you do not recognize

Which of the following is NOT included in your credit report? A. Your student loan payments B. Your current income C. Your employment history D. DUIs

B. Your current income

If you carry a credit card balance: A. The same interest rate must be charged for purchases, cash advances, and convenience checks. B. You cannot be charged an overpayment fee. C. The interest rates for purchases , cash advances, and convenience checks may be different. D. None of the above.

C. The interest rates for purchases , cash advances, and convenience checks may be different

When a lender is willing to loan money without requiring any collateral, the loan is considered: A. Too risky to make the loan. B. Secured. C. Unsecured. D. None of the above.

C. Unsecured

With a deferred interest plan, if you are late in your payments A. The outstanding balance is immediately due B. You must return the merchandise C. You may be charged interest on the entire balance retroactively D. None of the above

C. You may be charged interest on the entire balance retroactively

To be in the top 10% of households, annual earnings should exceed about A. $68,000 B. $160,000 C. $113,000 D. $240,000

C. $113,000

According to the IRS, what percentage of households has a net worth of at least $1 million? A. 1.49% B. 14.9% C. 4.9% D. 49%

C. 4.9%

According to the Census Bureau, what % most closely represents the number of children born out of wedlock? A. 20% B. 30% C. 40% D. 50%

C. 40%

Seniors are eligible for Medicare at age A. 70.5 B. 59 C 65 D. 62

C. 65

For the best credit score, which of the following is NOT recommended? A. Pay at least the minimum balance on all cards B. Keep your debt to credit ratio to 30% or less C. Do not borrow money or use a credit card D. Pay your bills on time over time

C. Do not borrow money or use a credit card

The burden of saving and investing for retirement and healthcare is shifting more from the A. Individual to the government B. Government to the employee C. Employer to employee D. Employee to employer

C. Employer to Employee

Video: Which of the following is the credit rating agencies allowed to consider when computing your credit score? A. Marital status B. Whether you are on welfare C. None of the above D. Your national origin

C. None of the above

Which of the following is NOT part of the formula used by FICO in calculation your credit score? A. Debt-to credit ratio. B. Length of credit history. C. Number of bank savings accounts. D. Mix of credit cards and loans.

C. Number of bank savings accounts.

Revolving credit is when you can: A. Increase your credit limit by 100%. B. Turn short-term credit into an installment loan. C. Reuse your credit line over and over. D. Close out the account by paying a balance transfer fee.

C. Reuse your credit line over and over.

Which is NOT an interest rate? A. Variable B. Fixed C. Revolving D. Go-to

C. Revolving

One way to increase your credit score is to: A. Marry someone with higher credit score. B. File for bankruptcy. C. Take out a new credit card and stop charging. D. Open a new account using a fake identity.

C. Take out a new credit card and stop charging.

The most common error found in credit card reports is: A. Social Security number is in error. B. It's not your report. C. Charges mistakenly reported. D. All of the above.

D. All of the above.

Approximately what percentage of millionaires are self-employed or own a business? A. 35% B. 15% C. 65% D. 50%

D. 50%

Video: If you are healthy, you should wait until which age to claim social security benefits in order to maximize your expected lifetime benefits? A. 62 B. 66 C. 76 D. 70

D. 70

Video: The median credit score is: A. 612 B. 412 C. 512 D. 712

D. 712

Video: Which of the following types of debt should you always try to avoid? A. A student loan B. A Mortgage C. A car loan D. A pawn shop loan

D. A pawn shop loan

Debt has which characteristics? A. Debt comes with interest B. Debt must be repaid C. The state of owing something such as money D. All of the above

D. All of the above

Identity theft can be done A. By hacking B. By theft of a wallet or purse C. By email or phone D. All of the above

D. All of the above

Medicare Part A is A. Benefits apply to hospitals and skilled nursing B. Paid for by payroll taxes C. Free to seniors who enroll D. All of the above

D. All of the above

Which best describes a "judgment" arrived at in a court of law? A. It states how much creditors are owed B. It becomes public record C. It is probably reflected in your credit report D. All of the above

D. All of the above

Bankruptcies are: A. Handled in federal court. B. Will not relieve you of alimony or child support. C. Will appear on your credit report. D. All of the above.

D. All of the above.

In order to be eligible for Social Security benefits you must have: A. A minimum of earned income in each quarter. B. 40 quarters of covered employment C. Be an American citizen or legal alien D. All of the above.

D. All of the above.

Part B of Medicare is: A. Partially funded by a 3.8% surtax. B. Means tested. C. Optional. D. All of the above.

D. All of the above.

The biggest financial challenge facing future generations is: A. Huge federal debts to be repaid. B. More elderly to be supported by fewer works. C. Large numbers of under-educated and unemployed workers to be supported. D. All of the above.

D. All of the above.

What does a Notary Public do? A. Signs contracts. B. Signs court orders. C. Issues court documents. D. Witnesses the signing of non-contentious documents.

D. Witnesses the signing of non-contentious documents.

A default rate of interest is a lower rate of credit card interest

False

About 50% of employers use credit checks as part of the hiring process. This is legal even if the employer doesn't have your permission

False

Both Part A and B of Medicare are free to eligible seniors but Part D is paid for by the individual

False

Debit cards are unsecured because the money is in your account

False

If you charge more than your credit limit you'll get a late payment fee

False

If you pay off the balance each month your credit score will be lowered

False

Installment debt used to purchase big ticket items is usually an interest only loan to be fully repaid at the end of the term

False

Interest paid on credit cards is tax deductible

False

Most credit card companies charge an inactivity fee if you have NOT used your card in at least 6 months

False

Most millionaires choose occupation based on how much money they would make

False

Under Social Security the employer and employee A. High income earners pay more than the employer B. The employers pays more than the employee C. Share equally in the cost of the program D. None of the above

share equally in the cost of the program

as global population ages and birth rates decline governments will need to

cut benefits to seniors

Which is NOT a factor related to a credit card?

secured debt

of all those students who use credit cards, the most common payment behavior is to

make more than the minimum payment but carry a balance