Consumer & Financial Lit Chapter 4

Question 0

Credit card -

Answer 0

Type of card issued by a bank that allows users to finance a purchase.

Question 1

Annual percentage rate (APR) -

Answer 1

Def. #1 Cost of borrowing money on an annual basis. / def. #2 Takes into account in the interest rate and other related fees on a loan.

Question 2

Credit Report -

Answer 2

A detailed report of an individual credit history.

Question 3

Credit Score -

Answer 3

Def. #1 A measure of an individual credit risk. / Def. #2 Calculated from a credit report using a standardized formula.

Question 4

Annual Fee -

Answer 4

A yearly fee that’s charged by the credit card company for the convenience of the credit card.

Question 5

Debt Snowball -

Answer 5

Preferred method of debt repayment.

Question 6

Depreciation -

Answer 6

A decrease or loss in value.

Question 7

Introductory Rate -

Answer 7

An interest rate charged to a consumer during the early stages of a loan.

Question 8

Loan Term -

Answer 8

Time frame that a loan agreement is in force, and before or at the end of which the loan should either be repaid or renegotiated for another term.

Question 9

Tax Deduction -

Answer 9

An expense, such as a charitable contribution, that can be deducted from’s one taxable income.