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Personal Finance Courses: Credit

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1.
Opening several new credit accounts in a short period of time can result in an improved credit score.
Choose wisely. There is only one correct answer.
False. Opening several new credit accounts in a short period of time can result in a lowered credit score.
2.
Paying the minimum monthly payment on your credit is affordable, but a major downside is that it takes much longer to pay off.
Choose wisely. There is only one correct answer.
True. The less you pay each month, the longer it takes to pay off. Plus, you pay a huge amount of interest.
3.
Credit is free money.
Choose wisely. There is only one correct answer.
False. Credit is a loan of money, meaning you must pay it back with interest after using it. It is not free money.
4.
Having a credit card that does not report your payment history to the credit bureaus helps you build a good credit history.
Choose wisely. There is only one correct answer.
False. To build a credit history, you want the card to report your payment history. Otherwise, the bureaus won't know about it.
5.
If you have to deposit a few hundred dollars into your bank in order to get a credit card, what kind of card is that called?
Choose wisely. There is only one correct answer.
Secured. Secured cards require you to deposit money. This is the money that you will be drawing from with your card.
6.
Which of the following is probably the wisest use of credit?
Choose wisely. There is only one correct answer.
Pay off higher-interest loans before lower-interest loans.
7.
Which of the following actions are outside collection agencies legally allowed to take against you?
Choose wisely. There is only one correct answer.
None of the above. All these actions are illegal.