Home > Basics > Beginner
Basics Beginner: Managing Your Debt

Test your knowledge

Choose wisely. There is only one correct answer to each question.

0%
Keep studying!
Review your answers below to learn more.
1.
If you file for bankruptcy, the bankruptcy will stay on your credit record for _______ years.
Choose wisely. There is only one correct answer.
10. After 10 years, it will disappear.
2.
A good way to reduce your monthly debt payments is to pay only the minimum amount due on credit card statements.
Choose wisely. There is only one correct answer.
False. Paying the minimum amount due on credit card statements will only increase the time and money paid on a debt.
3.
Paying only the minimum amount due on a credit card bill _______.
Choose wisely. There is only one correct answer.
Increases the cost and the time it takes to repay. It is best to repay higher interest rate loans faster.
4.
If you are in debt, why is it important to first deal with the causes of the debt?
Choose wisely. There is only one correct answer.
It can prevent them from recurring. Though not guaranteed to, there is a good chance you can prevent future occurrences.
5.
Which of the following types of loans would you expect to have the lowest interest?
Choose wisely. There is only one correct answer.
Short-term secured. Short-term and secured loans generally have lower rates than long-term or unsecured loans.
6.
A disadvantage of refinancing a short-term loan to a long-term loan is that _______.
Choose wisely. There is only one correct answer.
It may cost more in the long term. Taking longer to pay a short-term loan costs more over time.
7.
If you borrow money to buy an item that is able to provide cash income to you, that item can be called _______.
Choose wisely. There is only one correct answer.
An investment. Investments provide a return to you, such as income.
8.
To determine how much you should pay each month on credit card bills, _______.
Choose wisely. There is only one correct answer.
Use a financial calculator. Enter the number of months, interest rate, and principal balance to calculate the monthly payment.