Credit and Debt

Last updated almost 7 years ago

5 questions

Note from the author:

GSE SSEPF4

Last updated almost 7 years ago

5 questions

Note from the author:

GSE SSEPF4

Question 1

You are trying to determine which 36-month simple interest loan is the best deal. Which should you use to compare the loans?

the annual percentage rate on the loan

your credit score

whether the lender is close your home 

the number of months of the loan

Question 2

whether the borrower has collateral

character (credit score)

capacity to repay the loan

previous ownership of a home

Question 3

Putting the $5000 on a credit card

Taking out an extended loan from a pay day lender

Using his car as collateral at a title pawn lender

An installment loan from a bank or credit union

Question 4

A fixed rate builds your credit score more than a variable rate.

A fixed rate will always be lower than a variable rate.

A fixed rate gives you constant, predictable payments.

A fixed rate is easier to refinance than a variable rate.

Question 5

Financial institution A's loan  would cost less because it has simple interest.

Both loans would cost the same because they each have a 6% interest rate.

More information is needed to make a determinination.

Financial institution B's loan would cost less because it has compound interest.

Question 1

the annual percentage rate on the loan

your credit score

whether the lender is close your home 

the number of months of the loan

Question 2

whether the borrower has collateral

character (credit score)

capacity to repay the loan

previous ownership of a home

Question 3

Putting the $5000 on a credit card

Taking out an extended loan from a pay day lender

Using his car as collateral at a title pawn lender

An installment loan from a bank or credit union

Question 4

A fixed rate builds your credit score more than a variable rate.

A fixed rate will always be lower than a variable rate.

A fixed rate gives you constant, predictable payments.

A fixed rate is easier to refinance than a variable rate.

Question 5

Financial institution A's loan  would cost less because it has simple interest.

Both loans would cost the same because they each have a 6% interest rate.

More information is needed to make a determinination.

Financial institution B's loan would cost less because it has compound interest.