Everfi Module 3

Which of the following are true if you pay only the minimum amount each month towards your credit card bill? A. You will be charged interest on your remaining balance B. Your Annual Percentage Rate will increase C. You may be in debt for a long time

A & C

Which of the following payment types require you to pay upfront? Money order Cashier's check Pre-paid card All of the above

All of the above

Which of the following tells you how much your credit card interest will be if you only pay the minimum balance each month? Late fee Annual membership fee Balance transfer fee Annual Percentage Rate

Annual Percentage Rate

Which of the following is NOT true of credit cards? Some offer rewards You can be charged a fee if you're late making a monthly payment Offer highest level of fraud protection Best payment type to use when sticking to a budget

Best payment type to use when sticking to a budget

Which of the following is true? Checks and Debit Cards both withdraw money directly from a bank account. Checks are the most widely accepted form of payment Debit Cards often have a higher interest rate than Credit Cards. Debit cards offer the highest level of fraud protection.

Checks and Debit Cards both withdraw money directly from a bank account.

What is the amount of money you still owe to their credit card company called?

Credit card balance

The amount of money you can charge to a credit card is called:

Credit limit

Which payment method typically charges the highest interest rates? Credit cards Cashier's checks Pre-paid cards Payday loans

Payday loans

What is a credit card balance?

The amount of money you still owe to the credit card company

What is a credit limit?

The maximum amount you can charge each billing cycle.

Which of the following is true of both paying with a check and paying with a debit card? Both are accepted by most people and businesses When used, both take money directly from your account A personal identification number must be anytime checks or debit cards are used Both work like a loan from your bank that you can pay back later

When used, both take money directly from your account

Which of the follow will happen if you miss a monthly credit card payment? You will be charged a late fee You lose reward points Your APR will increase the next month Both A and B

You will be charged a late fee

The annual percentage rate on a credit card determines _______.

the amount of interest you are charged on credit card purchases

Which payment type can help you stick to a budget?

Debit cards

Which of the following statements comparing debit cards to credit cards is TRUE? Debit cards allow you to draw funds directly from your checking account. Debit cards typically offer greater fraud protection than credit cards. Debit cards never require a signature to finalize a purchase like credit cards. Debit cards charge higher interest rates on purchases than credit cards.

Debit cards allow you to draw funds directly from your checking account.

If you are planning to carry a large balance on your credit card, which of the following credit card features should you look for? Low APR Low balance transfer fee Lots of credit card rewards A large credit limit

Low APR

Making the minimum credit card payment:

Means you are paying a small portion of your total credit card debt

Which of the following is NOT a common credit card fee? Late fee Annual membership fee Balance transfer fee Minimum payment fee

Minimum payment fee

Which of the following can increase your credit card's APR? Paying the minimum Missing a credit card payment Paying off the full balance Cashing in on rewards points

Missing a credit card payment