Question 1

Revolving check credit is a:

Accepted Answer

A)   credit arrangement that has no extra costs.
B)   prearranged loan for a specified amount that you can use by writing a special check.
C)   credit arrangement that has no specific repayment plan.
D)   synonym for installment cash credit.
E)   synonym for single lump-sum credit.F) B) and D)
G) D) and E)

Question 2

The accuracy of credit reports has worsened recently.

Accepted Answer

A) True 
 B)False

Question 3

Debit cards are often called bank cards, ATM cards, cash cards, and check cards.

Accepted Answer

A) True 
 B)False  True

Question 4

Your friends and neighbors can get credit information about you.

Accepted Answer

A) True 
 B)False

Question 5

If there is incorrect information in your credit file:

Accepted Answer

A)   you should sue the credit bureau.
B)   the credit bureau has no power to change it.
C)   the credit bureau must reinvestigate and modify or remove inaccurate data.
D)   you must wait at least six months prior to launching an investigation.
E)   you have no means of correcting it.F) C) and D)
G) A) and B)

Question 6

Cobranded credit cards:

Accepted Answer

A)   are often linked with a certain business trade name offering "points".
B)   help build customer loyalty.
C)   allow the cardholder to earn rebates on products and services.
D)   have increased in popularity since 1992.
E)   All of these are correct.F) D) and E)
G) A) and B)

Question 7

Most consumers have only one choice in financing current purchases.

Accepted Answer

A) True 
 B)False

Question 8

Most of the information in your credit file may be reported for only seven years. If you have declared personal bankruptcy, that fact may be reported for 10 years.

Accepted Answer

A) True 
 B)False

Question 9

If you have incorrect information in your credit file:

Accepted Answer

A)   you can't really do much about it.
B)   you have no legal remedies.
C)   credit bureaus are not required to change it.
D)   there are legal remedies available to you.
E)   don't worry because it will not affect your ability to borrow money.F) A) and B)
G) All of the above

Question 10

Which one of the following is not a source that provides data to credit bureaus?

Accepted Answer

A)   Banks
B)   Finance companies
C)   Merchants
D)   Court records
E)   Internal Revenue ServiceF) C) and E)
G) B) and D)

Question 11

What are the two basic types of credit? Give examples of both.

Accepted Answer

The answer of What are the two basic types of...

Question 12

Stored value (or gift)  cards:

Accepted Answer

A)   look nothing like typical debit cards.
B)   have decreased in popularity since the mid-1990s.
C)   work the same as a credit card.
D)   may be eroded by fees and eventually expire.
E)   are currently being used for very limited purposes.F) B) and C)
G) C) and D) D

Question 13

If you have declared personal bankruptcy, that fact may be reported by credit bureaus for ____________ years.

Accepted Answer

A)   5
B)   10
C)   15
D)   20
E)   25F) C) and D)
G) A) and B)

Question 14

When you complain about your billing error, the creditor must acknowledge your letter within ____________ days.

Accepted Answer

A)   10
B)   20
C)   30
D)   60
E)   90F) B) and E)
G) A) and B)

Question 15

College students are not a prime target for credit card issuers.

Accepted Answer

A) True 
 B)False

Question 16

When imposters take your name, they are committing a crime.

Accepted Answer

A) True 
 B)False  True

Question 17

In the 5 Cs of credit, capacity refers to the borrower's attitude toward his or her credit obligations.

Accepted Answer

A) True 
 B)False

Question 18

Karen Price is 55 years old, divorced, and has worked at her current job for five years. She is interested in looking at her credit report. Which of the following pieces of information should she find in that report?

Accepted Answer

A)   The address of the house she lived in as a child
B)   A loan for furniture she paid off 12 years ago
C)   The outstanding balance on the Visa card she has today
D)   The names and addresses of her grown children
E)   The fact that she was late paying her electric bill 8 years agoF) C) and D)
G) A) and B)

Question 19

It is safer to use credit, since charge accounts and credit cards let you shop and travel without carrying large amounts of cash.

Accepted Answer

A) True 
 B)False

Question 20

Samantha Prescott knows that credit companies must evaluate her on the same basis as a borrower who is male. Which consumer protection law guarantees her this right?

Accepted Answer

A)   Fair Credit Reporting Act
B)   Fair Credit Billing Act
C)   Equal Credit Opportunity Act
D)   Fair Debt Collection Practices Act
E)   Truth in Lending ActF) B) and C)
G) A) and E)

Exam 6: Introduction to Consumer Credit

Revolving check credit is a:

Correct AnswerverifiedShow Answer

The accuracy of credit reports has worsened recently.

Correct AnswerverifiedShow Answer

Debit cards are often called bank cards, ATM cards, cash cards, and check cards.

Correct AnswerverifiedTrue

Your friends and neighbors can get credit information about you.

Correct AnswerverifiedShow Answer

If there is incorrect information in your credit file:

Correct AnswerverifiedShow Answer

Cobranded credit cards:

Correct AnswerverifiedShow Answer

Most consumers have only one choice in financing current purchases.

Correct AnswerverifiedShow Answer

Most of the information in your credit file may be reported for only seven years. If you have declared personal bankruptcy, that fact may be reported for 10 years.

Correct AnswerverifiedShow Answer

If you have incorrect information in your credit file:

Correct AnswerverifiedShow Answer

Which one of the following is not a source that provides data to credit bureaus?

Correct AnswerverifiedShow Answer

What are the two basic types of credit? Give examples of both.

Correct AnswerverifiedShow Answer

Stored value (or gift) cards:

Correct AnswerverifiedD

If you have declared personal bankruptcy, that fact may be reported by credit bureaus for ____________ years.

Correct AnswerverifiedShow Answer

When you complain about your billing error, the creditor must acknowledge your letter within ____________ days.

Correct AnswerverifiedShow Answer

College students are not a prime target for credit card issuers.

Correct AnswerverifiedShow Answer

When imposters take your name, they are committing a crime.

Correct AnswerverifiedTrue

In the 5 Cs of credit, capacity refers to the borrower's attitude toward his or her credit obligations.

Correct AnswerverifiedShow Answer

Karen Price is 55 years old, divorced, and has worked at her current job for five years. She is interested in looking at her credit report. Which of the following pieces of information should she find in that report?

Correct AnswerverifiedShow Answer

It is safer to use credit, since charge accounts and credit cards let you shop and travel without carrying large amounts of cash.

Correct AnswerverifiedShow Answer

Samantha Prescott knows that credit companies must evaluate her on the same basis as a borrower who is male. Which consumer protection law guarantees her this right?

Correct AnswerverifiedShow Answer

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