Question 1

What would be the maximum limit for an individual's debt-to-equity ratio,excluding the home mortgage?

Accepted Answer

A)  0.50
B)  0.33
C)  1.00
D)  2.00
E)  2.25F) A) and E)
G) None of the above

Question 2

In addition to department stores,where else is a good place to obtain your first credit card?

Accepted Answer

A)  Banks
B)  Credit unions
C)  Savings and loans associations
D)  Gasoline companies
E)  Investment companiesF) A) and D)
G) C) and D)

Question 3

If you cosign a loan:

Accepted Answer

A)  you are only responsible for half of the debt obligation.
B)  you will be asked, but not required, to pay the loan in full if the borrower fails to pay.
C)  you will be required to pay the loan in full if the borrower defaults on the payments.
D)  the creditor must first try to collect from the borrower.
E)  the creditor is prohibited from garnishing your wages if you refuse to pay the loan in full.F) C) and D)
G) None of the above

Question 4

What do creditors look for when you apply for credit?

Accepted Answer

Creditors determine credit wor...

Question 5

Which federal consumer credit law places the burden of proof for accurate credit information on the credit reporting agency rather than on the consumer?

Accepted Answer

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

Question 6

What does it mean when a credit card is co-branded?

Accepted Answer

Co-branding is the linking of ...

Question 7

Installment sales credit is a loan that allows you to receive high-priced items,such as large appliances or furniture.

Accepted Answer

A) True 
 B)False

Question 8

If you believe you have been refused credit due to discrimination,what are three steps you can take?

Accepted Answer

1.Complain to the creditor.Let the credi...

Question 9

In the 5 Cs of credit,capital refers to your financial ability to meet credit obligations.

Accepted Answer

A) True 
 B)False

Question 10

Which of the following are most vulnerable to misusing credit?

Accepted Answer

A)  Married couples
B)  Shopaholics and young adults
C)  Retired adults
D)  Savers
E)  None of the aboveF) B) and D)
G) A) and C)

Question 11

Which federal consumer credit law prohibits credit discrimination based on sex and marital status?

Accepted Answer

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

Question 12

The debt payments-to-income ratio is:

Accepted Answer

A)  calculated by dividing total liabilities by net worth.
B)  calculated by dividing monthly debt payments (excluding mortgage payments)  by net monthly income.
C)  determined by dividing your assets by your liabilities.
D)  a useless ratio for determining your credit capacity.
E)  rarely used by creditors in determining credit worthiness.F) C) and D)
G) A) and E)

Question 13

Installment cash credit is a direct loan of money for personal purposes,home improvements,or vacation expenses.

Accepted Answer

A) True 
 B)False

Question 14

The credit bureau cannot charge you a fee for a copy of your credit report if you request it within ______ days of being notified of a denial based on a credit report.

Accepted Answer

A)  10
B)  20
C)  30
D)  40
E)  60F) D) and E)
G) A) and D)

Question 15

An unauthorized person who obtains a credit report under false pretenses may be:

Accepted Answer

A)  sued by the lender.
B)  sued by the borrower.
C)  jailed for 5 years.
D)  subject to a fine and imprisonment.
E)  placed on a probation.F) B) and E)
G) B) and D)

Question 16

Which of the following places new restrictions on credit card lending and eliminates certain fees?

Accepted Answer

A)  Fair Credit Reporting Act
B)  Credit Card Accountability, Responsibility, and Disclosure Act
C)  Truth in Lending Act
D)  Equal Credit Opportunity Act
E)  Fair Credit Billing ActF) A) and B)
G) A) and E)

Question 17

If you have a complaint about a bank in connection with any of the federal credit laws,who should you contact?

Accepted Answer

A)  National Credit Union Association
B)  Federal Trade Commission
C)  Federal Reserve System
D)  Comptroller of the Currency
E)  Bank Vice-PresidentF) A) and C)
G) A) and B)

Question 18

A home equity loan is usually set up as a revolving line of credit,typically with a fixed interest rate.

Accepted Answer

A) True 
 B)False

Question 19

The baby boom generation currently represents about 30 percent of the population but holds nearly ____________ percent of the outstanding debt.

Accepted Answer

A)   80
B)  70
C)  60
D)  50
E)  40F) A) and C)
G) B) and E)

Question 20

Consumer credit refers to the use of credit for personal needs by individuals and families.

Accepted Answer

A) True 
 B)False

Exam 6: Introduction to Consumer Credit

The baby boom generation currently represents about 30 percent of the population but holds nearly ____________ percent of the outstanding debt.

Correct AnswerverifiedShow Answer

Which of the following places new restrictions on credit card lending and eliminates certain fees?

Correct AnswerverifiedShow Answer

If you believe you have been refused credit due to discrimination,what are three steps you can take?

Correct Answerverified1.Complain to the creditor.Let the credi...View AnswerShow Answer

Installment cash credit is a direct loan of money for personal purposes,home improvements,or vacation expenses.

Correct AnswerverifiedShow Answer

What do creditors look for when you apply for credit?

Correct AnswerverifiedCreditors determine credit wor...View AnswerShow Answer

If you cosign a loan:

Correct AnswerverifiedShow Answer

What does it mean when a credit card is co-branded?

Correct AnswerverifiedCo-branding is the linking of ...View AnswerShow Answer

Consumer credit refers to the use of credit for personal needs by individuals and families.

Correct AnswerverifiedShow Answer

What would be the maximum limit for an individual's debt-to-equity ratio,excluding the home mortgage?

Correct AnswerverifiedShow Answer

An unauthorized person who obtains a credit report under false pretenses may be:

Correct AnswerverifiedShow Answer

In the 5 Cs of credit,capital refers to your financial ability to meet credit obligations.

Correct AnswerverifiedShow Answer

If you have a complaint about a bank in connection with any of the federal credit laws,who should you contact?

Correct AnswerverifiedShow Answer

The credit bureau cannot charge you a fee for a copy of your credit report if you request it within ______ days of being notified of a denial based on a credit report.

Correct AnswerverifiedShow Answer

Which federal consumer credit law places the burden of proof for accurate credit information on the credit reporting agency rather than on the consumer?

Correct AnswerverifiedShow Answer

The debt payments-to-income ratio is:

Correct AnswerverifiedShow Answer

Installment sales credit is a loan that allows you to receive high-priced items,such as large appliances or furniture.

Correct AnswerverifiedShow Answer

Which federal consumer credit law prohibits credit discrimination based on sex and marital status?

Correct AnswerverifiedShow Answer

A home equity loan is usually set up as a revolving line of credit,typically with a fixed interest rate.

Correct AnswerverifiedShow Answer

Which of the following are most vulnerable to misusing credit?

Correct AnswerverifiedShow Answer

In addition to department stores,where else is a good place to obtain your first credit card?

Correct AnswerverifiedShow Answer

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified
1.Complain to the creditor.Let the credi...
View Answer

Correct Answer
verified

Correct Answer
verified
Creditors determine credit wor...
View Answer

Correct Answer
verified

Correct Answer
verified
Co-branding is the linking of ...
View Answer

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified