Financial Quiz
[1] If you pay the monthly "minimum payment" on your credit card account, you will pay off the entire balance (assuming no additional charges) in less than ten years. True False [2] You are not very good with budgeting your money and decide to get a "debit" card which immediately deducts each purchase from your bank account. In this way, you do not have to worry about paying high finance charges due to overspending. True False
[3] You are broke and pay your Visa bill with a "courtesy" check from MasterCard. This is legal. True False [4] You are very careful with your money and pay all your bills on time at the end of the month. As a result, you happily accept a "no annual fee" MasterCard offer because the bank is essentially giving you a "free" loan. True False [5] At the campus student center, an American Express representative offers you a free umbrella. She explains that you will save money on monthly interest fees by using the AMEX charge card rather than a credit card from MasterCard, Visa, or Discover. True False [6] Upon returning from the holiday break, your credit card statement explains that you can "skip" this month's minimum payment due to your excellent payment history. This is the banks' way of rewarding loyal customers by waiving the finance charges during the "skip" month. True False [7] Credit cards are the most common source of money for recent college graduates to start their own businesses. True False [8] Falling behind in your credit card payments is not a serious problem. This is because most employers know that students have limited sources of income and rarely find out about delinquent credit card accounts before job interviews. True False [9] You receive your Visa credit card statement on the 1st of the month and it is due 15 days later. Since you always send the minimum payment, there is no financial advantage in mailing your check early as long as it is received by the 15th. True False [10] You are going out with friends and need $20 cash for the evening activities. Your options are to take a cash advance from a nearby ATM or pawn your watch. Since you will pay for this loan in full at the end of the month, you decide to use your credit card since it is much cheaper than a pawnshop. True False BONUS In spring 1999, President Clinton was forced to use cash instead of credit at a book store. Which major company refused to pay for his purchases? Visa MasterCard American Express
