Personal Finance
A common cause of financial difficulties is: A. Poor money management habits B. A need for additional career training C. Preparing your tax return late D. Not having enough life insurance
A
A credit card issued through a credit union would be an example of a ________ card A. Bank B. Travel and entertainment C. Store D. Proprietary
A
The Truth-in-Lending law requires that borrowers be informed of the: A. Amount financed B. Cost of auto insurance C. Features of an extended warranty D. Reasons a person has been denied credit
A
The mail order rule requires that companies: A. Notify customers if an item is not currently available B. Only sell certain items by mail C. Accept credit cards for mail-order purchases D. Allow a person to return an item for full credit
A
The most useful information in an advertisement would be: A. The price B. Comments from production users C. A list of product accessories D. An endorsement from a well-known person
A
To build a credit history, a person could: A. Establish a steady employment record B. File his or her federal income taxes on time C. Use an ATM several times a month D. Request to view her or his credit file
A
Using the 20-10 rule, a person earning $1,500 a month should not have monthly credit payments that exceed: A. 300 B. 150 C. 20 D. 30
A
Voter registration records are considered to be: A. Public records B. Private records C. Company records D. A database profile
A
The maximum dollar amount that can be charged on a specific credit card account
Credit line
A ______________ mortgage has a very large final payment A. Conventional B. Graduated-payment C. Shared-appreciation D. Balloon
D
A credit report would include a person's: A. Federal income tax data B. Balances for electric bills and other utilities C. Salary history D. Balances for installment accounts
D
A person's regular income is referred to as: A. Character B. Capital C. Collateral D. Capacity
D
Advertisements using a well-known person are examples of the ________ advertising technique A. Peer approval B. Unfinished comparison C. Status D. Endorsement
D
An example of a fair debt-collection practice would be to: A. Pretend to be a salesperson to attempt to collect a debt B. Threaten to take legal action to collect the money owed C. Call a debtor at work even if personal calls are not allowed D. Call a debtor at home before 8 p.m.
D
Books tapes and music CDs are commonly sold using: A. A perceptual contrast B. Numerical claims C. Unfinished comparisons D. A negative option
D
The auto insurance coverage for damage to your vehicle as a result of an accident is called: A. Property damage B. Comprehensive C. Liability D. Collsion
D
The first step a person with a consumer complaint should take is to: A. Obtain legal assistance B. Contact a consumer agency C. Write to the headquarters of the company D. Return to the place of purchase
D
The most reliable source of consumer information would be from: A. An advertisement B. A salesperson C. An executive of the company D. A product label
D
The organization that provides companies with information on a person's past use of credit is: A. A credit union B. The Consumer Credit Counseling Service C. The Fair Credit Reporting Agency D. A credit bureau
D
Denoting a form of incentive offered to buyers of certain products whereby they receive a cash refund after making their purchase
Rewards
The yearly interest rate charged on outstanding credit card balances
APR
The once a year cost of owning a credit card
Annual fee
A buying club commonly: A. Requires a minimum purchase B. Has a large initiation fee C. Wants the member to encourage others to join D. Only allows a few people in an area to be members
B
A common disadvantage of buying a home is: A. Few financial benefits B. Limited mobility C. Restrictions on decorating and having pets D. Conditions in the lease
B
A nonprofit organization that provides financial counseling is: A. The Federal Deposit Insurance Corporation B. The Consumer Credit Counseling Service C. The Better Business Bureau D. The National Credit Union Administration
B
An example of public records would be: A. A credit card statement B. A telephone directory C. Medical records D. An employment application on file with a company
B
If a billing error occurs on a credit statement, a consumer has ___ days to notify the creditor A. 30 B. 60 C. 90 D. 120
B
The amount of a mortgage a person can afford is affected by: A. The location of the house B. Her or his income C. The cost of insurance D. His or her age
B
The charges for settling a real estate transaction are also called _____ costs A. Mortgage B. Closing C. Possession D. Selling
B
The grace period refers to the time: A. Taken to process a credit card application B. For paying an accountant without an interest charge C. Allowed to notify a creditor of a billing error D. Used for calculating interest
B
The right to cancel certain purchases of $25 or more within three business days is known as the _________ rule A. Layaway B. Cooling-off C. Mail-order D. Telemarketing
B
Utility companies and medical service organizations commonly offer __________ credit A. Revolving B. Single-payment C. Installment D. Retail
B
_________ would be an example of an unethical action A. An infomercial B. An out-of-context quote C. An offer to work at home D. Comparison pricing in an advertisement
B
___________ warranty refers to the fact that a product will do what it is designed to do A. An extended B. An implied C. A dealer D. An unexpired manufacturer's
B
An amount of money in a savings or checking account
Balance
A common advantage of using credit is: A. Less impulse buying B. Lower cost for items purchased C. Ability to obtain needed items now D. Lower chance of overspending
C
A program-length commercial is commonly called: A. "Bait and switch" B. A perceptual contrast C. An infomercial D. An action guarantee
C
Bankruptcy refers to the process of: A. Obtaining permission to be late with credit payments B. Obtaining assistance from a credit counseling service C. Using court action to reduce or eliminate your debt D. Using court action to have payments owed deducted from group paycheck
C
Comparing the APR among several credit cards allows you to obtain the: A. Lowest grace period B. Lowest annual fee C. Lowest interest rate D. Least expensive method of calculating interest
C
Doctor's costs for injuries to others resulting from an accident are covered by _________ liability A. Medical B. Collision C. Bodily injury D. Comprehensive
C
The home-buying process starts with: A. Locating and evaluating a home B. Pricing the property C. Determining homeownership needs D. Obtaining an appraisal of the property
C
The most reliable source for buying a used car is usually: A. A rental car company B. A police auction C. A car dealer D. Private party sales
C
The purpose of a consolidation loan is to: A. Deduct amounts owed from a person's paycheck B. Pay off one credit card amount before others are paid C. Combine several debts into one payment D. Reduce the amount owed for federal income taxes
C
When using an ATM, your PIN is designed to: A. Indicate your current balance B. Provide the bank access to your financial records C. Provide security as an authorized user D. Indicate your credit rating
C
An infomercial is a type of "bait and switch"
F
Bankruptcy is suggested for people who are a few weeks behind in their credit payments
F
Bodily-injury liability covers the damage to another person's car for which you were at fault
F
Buying a home will usually have fewer costs than renting
F
Buying clubs are designed to help consumers compare prices at different stores
F
Collision insurance covers damage caused to a motor vehicle by vandalism or floods
F
Comments from buyers of a product in a commercial usually provide useful information
F
Consolidation loans are mainly used to finance the starting of a new business
F
Conventional mortgages usually have a rate that changes as market interest rates change
F
Installment credit usually allows a person to make additional purchases on an account
F
Layaway purchase plans are designed to help consumers buy items at discount prices
F
Most consumer complaints require legal action to solve
F
Most used cars sold by private parties have a one-year warranty
F
Public databases include such information such information as credit reports, school records, and medical records
F
The Freedom of Information Act allows access to most, but not all, private records of companies
F
The Truth-in-Lending law requires that a borrower be informed of the total finance charge
F
The annual fee for a credit card is set by the government
F
The average daily balance method of calculating interest is based on the opening balance of the account for the previous month
F
A credit bureau keeps track if people pay their bills on time
T
A credit report would include if a person had declared bankruptcy in the past
T
A disadvantage of using credit is impulse buying
T
A larger down payment will reduce the amount of the mortgage needed
T
A main advantage of buying is pride of ownership
T
A proprietary credit card is usually accepted by one type of store or company
T
A service contract is designed to avoid costly repairs as a motor vehicle gets older
T
A steady employment record helps a person's credit history
T
APR measures the interest rate charged by a credit card
T
An "unfinished comparison" in an advertisement provides consumers with incomplete information
T
Capital refers to a person's assets.
T
Credit repair service advertisements may be misleading due to the promises made to consumers in credit trouble
T
Debt collectors are usually allowed to call you at home before 8 p.m.
T
Financial difficulties are commonly caused by overspending
T
If someone uses your lost or stolen credit card, you are liable for no more than $50
T
Out-of-stock advertised specials are considered to be an unethical technique
T
People with financial difficulties may obtain assistance from the Consumer Credit Counseling Service
T
The Fair Credit Reporting Act allows a person to access his or her credit report
T
The cooling-off period generally applies to purchases of $25 or more
T
The home-buying process ends with closing the purchase transaction
T
The mail-order rule allows a person to cancel an order that is not shipped within a certain time period
T
Using the 20-10 rule, a person making $40,000 a year after taxes should have no more than $8,000 of outstanding debt
T