Pregunta 1 (4 puntos) Which statements best describe the difference between a periodic interest rate and an APR? (4 points) a A periodic interest rate is the amount of interest someone will pay for a specific time frame. An APR is the amount of interest someone will pay each year. b A periodic interest rate is the amount of interest someone will pay each year. An APR is the amount of interest someone will pay for a specific time frame. c A periodic interest rate is interest that is applied to an account at the end of a specific time frame. An APR is interest that is applied to an account once at the end of the year. d A periodic interest rate is interest that is applied to an account once at the end of the year. An APR is interest that is applied to an account at the end of a specific time frame. Pregunta 2 (4 puntos) Fay opens a credit card with an APR of 15.25% compounded monthly. How much is charged in interest this month if her balance is $1,300? (4 points) a $16.52 b $15.25 c $108.33 d $198.25 Pregunta 3 (4 puntos) Herman opened a credit card at a department store with an APR of 24.45% compounded semiannually. What is the APY on this credit card? (4 points) a 48.90% b 12.13% c 33.63% d 25.94% Pregunta 4 (4 puntos) Grady is comparing three investment accounts offering different rates. Account A: APR of 4.95% compounding monthly Account B: APR of 4.85% compounding quarterly Account C: APR of 4.75% compounding daily Which account will give Grady at least a 5% annual yield? (4 points) a Account A b Account B c Account C d Account B and Account C Pregunta 5 (4 puntos) Jackson has a previous balance of $767 on a credit card with a 16.5% APR compounded monthly. If he made a payment of $49 this month, what is the new balance on his credit card? (4 points) a $718.00 b $728.55 c $844.56 d $893.56 Pregunta 6 (4 puntos) Larry uses his credit card to purchase a new video game system for $445.07. He can pay off up to $200 per month. The card has an annual rate of 13.6% compounded monthly. How much total interest will he pay? (4 points) a $8.47 b $10.21 c $53.54 d $3.32 Pregunta 7 (4 puntos) Newton uses a credit card with a 18.6% APR, compounded monthly, to pay for a cruise totaling $1,920.96. He can pay $720 per month on the card. What will the total cost of this purchase be? (4 points) a $2,458.98 b $2,278.26 c $1,978.02 d $1,920.96 Pregunta 8 (4 puntos) Use the details of Patti's new credit card to answer the question that follows. APR - 19.1% compounded monthly Grace period - 30 days Minimum Payment - 3.5% of the remaining balance or $10, whichever is higher Patti charged $425 to her credit card last month. What is the first minimum payment she must make? (4 points) a $14.88 b $81.18 c $10.00 d $42.50 Pregunta 9 (4 puntos) In which situation would it be better to use cash instead of a credit card? (4 points) a purchasing groceries b purchasing a television c major car repairs d making hotel reservations Pregunta 10 (4 puntos) Which piece of information is not found in the inquiry section of a credit report? (4 points) a promotional credit card offers b savings account applications c credit card applications d mortgage applications Pregunta 11 (4 puntos) Temina has opened two credit cards in the last year. Use the information on each credit card located in the table below to answer the question. Credit Card A xxxx 4/4/11 $1,998.60 $0.00 PAYS AS AGREED $5,500 Credit Card B xxxx 6/5/11 $2,714.82 $0.00 PAYS AS AGREED $8,000 What is Temina's overall debt-to-credit ratio? (4 points) a 33.94% b 70.28% c 36.34% d 34.91% Pregunta 12 (4 puntos) Choose the fragment which best completes the following sentence. If you have a low credit score, you are more likely to (4 points) a receive a lower interest rate. b have many credit card offers. c pay your balance in full. d make payments late. Pregunta 13 (4 puntos) Use the table below showing the different types of savings accounts a bank offers to answer the question that follows. Opening Deposit Requirement Standard Savings - $25 Money Market Savings - $100 High Yield Savings - $25,000 CD - $2,500 Interest Rate Standard Savings - Variable Money Market Savings - Variable High Yield Savings - Variable CD - Fixed Option to Write Checks Standard Savings - none Money Market Savings - yes High Yield Savings - yes Account Alerts Standard Savings - yes Money Market Savings - yes High Yield Savings - yes CD - yes Features Standard Savings - Up to 6 withdrawals per month Money Market Savings - Up to 3 withdrawals per month High Yield Savings - Up to 3 withdrawals per month CD - Penalty if money withdrawn before maturity Monthly Fee Standard Savings - $3 per month unless you maintain a $300 balance Money Market Savings - $10 per month unless you maintain a $3,500 balance High Yield Savings - $25 per month unless you maintain a $25,000 balance CD - none Christina has $150 to open a savings account. She anticipates withdrawing money from her savings account regularly. Which account is the best choice for Christina? (4 points) a Standard Savings b Money Market Savings c High Yield Savings d CD Pregunta 14 (4 puntos) Leah owes $4,206 on a credit card with an 18.7% interest rate compounded monthly. What is the monthly payment she should make in order to pay off this debt in 4 years, assuming she does not charge any more purchases with the card? (4 points) a $786.73 b $87.63 c $125.10 d $387.01 Pregunta 15 (8 puntos) Describe, using complete sentences, the advantages and disadvantages of using a credit card. (8 points) Pregunta 16 (8 puntos) Explain, using complete sentences, the similarities and differences between checking accounts and savings accounts. (8 points) Pregunta 17 (8 puntos) Part 1 (4 points): Explain, using complete sentences, how someone might snowball their debt according to the balance. Part 2 (4 points): Explain, using complete sentences, the benefits to snowballing debt. (8 points)