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What are the 5 Cs of credit?

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Character,capacity,c...

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Installment credit exploded on the American scene with the advent of the


A) Airplane
B) Automobile
C) Cell phone
D) Computer
E) Train

F) C) and E)
G) B) and C)

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Consumer credit dates back to colonial times when it was extensively used by farmers.

A) True
B) False

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All of the following are consumer credit protection laws except


A) The Truth in Lending and Consumer Leasing Act
B) The Equal Credit Opportunity Act
C) The Fair Credit Billing Act
D) The Credit Lawsuit Act
E) The Consumer Credit Reporting Reform Act

F) B) and E)
G) B) and C)

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If you think a bill is wrong or you want more information about the bill,then you and your creditor should follow all of the steps here except


A) You should notify your creditor in writing.
B) You should pay the portion of the bill that is not in question.
C) Your creditor must acknowledge your letter within 30 days.
D) Your creditor must adjust your account or tell you why the bill is correct within two billing cycles.
E) Your creditor must reimburse you for your time spent researching the error.

F) A) and E)
G) None of the above

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Rachel Johnson went to the ATM to draw $300 cash with her debit card.She inadvertently pulled out her credit card instead,not realizing the expenses for cash advances.If her credit card company charges a cash advance fee of 3% and interest at 24% APR,what are the total fees she will pay for her mistake?


A) $3
B) $6
C) $9
D) $15
E) $24

F) C) and E)
G) B) and D)

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Which of the following is often the first sign of a stolen identity?


A) You receive bills for a credit card account you never opened.
B) You see charges to your account for things you purchased.
C) You receive a phone call from the thief.
D) You receive a duplicate credit card from your credit card company.
E) All of these are typical signs of a stolen identity.

F) A) and B)
G) A) and C)

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If you are a cosigner for a loan and the debt is not repaid,that fact will appear on your credit report.

A) True
B) False

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If you miss payments on a home equity loan,you can lose your


A) Savings account.
B) Car.
C) House.
D) Retirement account.
E) Furnishings.

F) A) and B)
G) D) and E)

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Closed-end credit is used for a specific purpose and involves a specific amount.

A) True
B) False

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Which of the following is an example of open-end credit?


A) An automobile loan
B) A department store credit card
C) An installment loan for purchasing furniture
D) A mortgage loan
E) Single lump-sum credit

F) A) and D)
G) A) and C)

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Consumer credit refers to the use of debit cards for personal needs.

A) True
B) False

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List at least five items that can appear in a credit file.

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A typical credit bureau file may contain...

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Thomas cosigned a loan for his friend Anders.If Anders does not pay the loan,what is Thomas liable for?

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Thomas is liable for...

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Which of the following is an example of closed-end credit?


A) A mortgage loan.
B) A department store credit card.
C) Overdraft protection.
D) A bank line of credit.
E) All of these are examples of closed-end credit.

F) B) and C)
G) C) and E)

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Many think that perhaps the greatest disadvantage of using credit is


A) The temptation to overspend.
B) The convenience offered instead of using cash.
C) The float from using credit.
D) The increase in total purchasing power.
E) The increased satisfaction during present and future income periods.

F) A) and C)
G) B) and E)

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Consumer credit allows businesses to be more efficient or more productive.

A) True
B) False

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Experts suggest that the debt payments-to-income ratio should be a maximum of


A) 0%
B) 20%
C) 25%
D) 50%
E) 100%

F) None of the above
G) A) and D)

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Define two of the following.Provide an example of each: a.Credit card. b.Debit card. c.Gift card. d.Smart card. e.Travel and entertainment card.

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a.A credit card essentially is a short-t...

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Information about a personal bankruptcy may be reported in your credit file for


A) 1 year.
B) 3 years.
C) 7 years.
D) 10 years.
E) Permanently.

F) B) and E)
G) B) and C)

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