Consumer Credit and Debt Management Quiz
Test your knowledge on consumer credit, debt-to-income ratios, APR, bankruptcy, and more with this quiz on credit and debt management.
#1
Which of the following is a form of consumer credit?
Student loans
Corporate bonds
Government grants
Stock options
#2
What does APR stand for in the context of credit?
Annual Percentage Rate
Average Payment Receipt
Advanced Payment Request
Annual Payment Return
#3
What is the purpose of a credit counseling service?
To offer loans to consumers
To provide education and assistance with managing debt
To increase credit card limits
To encourage overspending
#4
What is the main purpose of a credit score?
To determine the amount of debt you can accumulate
To evaluate an individual's creditworthiness
To calculate monthly income
To track credit card transactions
#5
What is the term for the maximum amount of credit extended to a borrower?
Credit limit
Interest rate
Credit score
Credit utilization ratio
#6
What does it mean to 'default' on a loan?
To pay off the loan early
To make consistent payments on time
To fail to repay a loan according to the terms agreed upon
To consolidate multiple loans into one
#7
What is the recommended debt-to-income ratio for healthy financial management?
#8
Which type of bankruptcy involves liquidating assets to repay debts?
Chapter 7
Chapter 11
Chapter 13
Chapter 9
#9
What is the 'snowball method' in debt repayment?
Paying off the debt with the highest interest rate first
Paying off the smallest debts first and then moving on to larger ones
Delaying debt repayment until a later time
Ignoring debt entirely
#10
Which of the following is not a factor affecting credit scores?
Payment history
Age
Marital status
Credit utilization
#11
Which federal law gives consumers the right to see their credit reports for free once a year?
Fair Credit Reporting Act (FCRA)
Consumer Credit Protection Act (CCPA)
Truth in Lending Act (TILA)
Equal Credit Opportunity Act (ECOA)
#12
Which of the following is a potential consequence of defaulting on a loan?
Increased credit score
Lower interest rates
Legal action by the lender
No impact on credit history
#13
What is a 'balance transfer' in the context of credit cards?
Transferring money from one bank account to another
Transferring an outstanding balance from one credit card to another with lower interest rates
Transferring ownership of a credit card account
Transferring funds from a credit card to a savings account
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