Question 1

The APR represents the stated interest rate.

Accepted Answer

A) True 
 B)False

Question 2

Given the following:  29 day billing cycle 4/17 Billing date previous balance $1,1004/27 Payment $7004/29 Charge $300 5/7 Payment $50\begin{array} { | l | r | } \hline 29 	ext { day billing cycle } \\hline 4 / 17 	ext { Billing date previous balance } & \$ 1,100 \\hline 4 / 27 	ext { Payment } & \$ 700 \\hline 4 / 29 	ext { Charge } & \$ 300 \\hline 	ext { 5/7 Payment } & \$ 50 \\hline\end{array}29 day billing cycle 4/17 Billing date previous balance 4/27 Payment 4/29 Charge  5/7 Payment ​$1,100$700$300$50​​  The average daily balance is:

Accepted Answer

A)  $910.34
B)  $755.17
C)  $810.43
D)  $755.71
E)  None of these

Question 3

John Sullivan bought a new Brunswick boat for $17,000. He made a $2,500 down payment on it. The bank's loan was for 60 months. Finance charges totaled $4,900. His monthly payment is:

Accepted Answer

A)  $313.33
B)  $323.33
C)  $332.33
D)  $232.33
E)  None of these

Question 4

Match the following terms with their definitions.
-Average daily balance

Accepted Answer

A)  Total of all payments minus amount financed
B)  Effective interest rate
C)  A payment process
D)  A revolving charge account
E)  Sum of daily balance divided by number of days in billing cycleF) Total of all monthly payments plus down paymentG) Used in calculation of average daily balanceH) Doesn't dictate interest ratesI) Cash price minus down paymentJ) Used to calculate rebate of finance chargeK) Purchase till maximum credit reachedL) Initial cash payment

Question 5

Match the following terms with their definitions.
-Amount financed

Accepted Answer

A)  Total of all payments minus amount financed
B)  Effective interest rate
C)  A payment process
D)  A revolving charge account
E)  Sum of daily balance divided by number of days in billing cycleF) Total of all monthly payments plus down paymentG) Used in calculation of average daily balanceH) Doesn't dictate interest ratesI) Cash price minus down paymentJ) Used to calculate rebate of finance chargeK) Purchase till maximum credit reachedL) Initial cash payment

Question 6

Pete Size read the following partial advertisement: Price $20,999; down payment $1,000; cash or trade; $390.85 per month for 60 months. Calculate (A)the total finance charge and (B)the APR by table lookup.

Accepted Answer

A. $390.85 × 60 - $1...

Question 7

Match the following terms with their definitions.
-Down payment

Accepted Answer

A)  Total of all payments minus amount financed
B)  Effective interest rate
C)  A payment process
D)  A revolving charge account
E)  Sum of daily balance divided by number of days in billing cycleF) Total of all monthly payments plus down paymentG) Used in calculation of average daily balanceH) Doesn't dictate interest ratesI) Cash price minus down paymentJ) Used to calculate rebate of finance chargeK) Purchase till maximum credit reachedL) Initial cash payment

Question 8

Match the following terms with their definitions.
-Truth in Lending Act

Accepted Answer

A)  Total of all payments minus amount financed
B)  Effective interest rate
C)  A payment process
D)  A revolving charge account
E)  Sum of daily balance divided by number of days in billing cycleF) Total of all monthly payments plus down paymentG) Used in calculation of average daily balanceH) Doesn't dictate interest ratesI) Cash price minus down paymentJ) Used to calculate rebate of finance chargeK) Purchase till maximum credit reachedL) Initial cash payment

Question 9

Calculate APR by table lookup (to nearest hundredth percent):
 $$\begin{array} { | l | l | l | l | l | } 
\hline \text { Purchase } && \text { Number of } & & \
\text { Price } & \begin{array} { l } 
\text { Down } \
\text { Payment }
\end{array} & \begin{array} { l } 
\text { monthly } \
\text { payment }
\end{array} & \begin{array} { l } 
\text { Amount } \
\text { financed }
\end{array} & \begin{array} { l } 
\text { Total } \
\text { payments }
\end{array} \
\hline \$ 1,800 & \$ 100 & 20 & \$ 1,700 & \$ 1,900 \
\hline
\end{array}$$

Accepted Answer

The answer of Calculate APR by table lookup (to nearest...

Question 10

The average daily balance is the same as the daily balance.

Accepted Answer

A) True 
 B)False

Question 11

Given a mortgage of $48,000 for 15 years with a rate of 11%, what are the total finance charges?

Accepted Answer

A)  $50,236.80
B)  $5,023.68
C)  $545.76
D)  $54,576
E)  None of these

Question 12

The cost of credit reports would be included in the amount financed.

Accepted Answer

A) True 
 B)False

Question 13

Amount financed is equal to:

Accepted Answer

A)  Cash price times down payment
B)  Cash price plus down payment
C)  Cash price minus down payment
D)  Cash price divided by down payment
E)  None of these

Question 14

Neal Selznick bought a new van for $10,000. Neal put down $1,000 and paid $275 monthly for 40 months. What is the total amount of finance charge that Neal paid at the end of 40 months?

Accepted Answer

$275 × 40 - ($10,000...

Question 15

Calculate the finance charge:
 $\begin{array}{|c|c|c|c|}
\hline \begin{array}{l}
\text { Laptop purchase } \
\text { price }
\end{array} & \text { Down Payment } & \begin{array}{l}
\text { Number of monthly } \
\text { payments }
\end{array} & \begin{array}{l}
\text { Amount of monthly } \
\text { payment }
\end{array} \
\hline 800 & \$ 300 & 16 & \$ 185 \
\hline
\end{array}$

Accepted Answer

The answer of Calculate the finance charge:
 \(\begin{array}{|c|c|c|c|}
\hline \begin{array}{l}
\text {...

Question 16

Most companies calculate the finance charge on credit card accounts as a percentage of the:

Accepted Answer

A)  Daily balance
B)  Weekly balance
C)  Average daily balance
D)  Average weekly balance
E)  None of these

Question 17

The monthly payment is calculated by totaling the finance charge and amount financed and dividing that by the number of payments of the loan.

Accepted Answer

A) True 
 B)False

Question 18

Match the following terms with their definitions.
-Revolving charge

Accepted Answer

A)  Total of all payments minus amount financed
B)  Effective interest rate
C)  A payment process
D)  A revolving charge account
E)  Sum of daily balance divided by number of days in billing cycleF) Total of all monthly payments plus down paymentG) Used in calculation of average daily balanceH) Doesn't dictate interest ratesI) Cash price minus down paymentJ) Used to calculate rebate of finance chargeK) Purchase till maximum credit reachedL) Initial cash payment

Question 19

Able Long buys a new desk for $2,400. Able will pay back $250 per month. Monthly interest is 3% on the unpaid balance. Calculate the balance outstanding after the second payment. (Use the U.S. Rule.)

Accepted Answer

The answer of Able Long buys a new desk for...

Question 20

Calculate the finance charge:
 $\begin{array}{|l|r|r|r|}
\hline\text { Sofa purchase } && \text { Number of monthly } & \text {Amount of monthly }\
\text { price } & \text { Down Payment } & \text { payments } & \text { payment }\
\hline\$1,500&\$200&12&\$175\
\hline
\end{array}$

Accepted Answer

The answer of Calculate the finance charge:
 \(\begin{array}{|l|r|r|r|}
\hline\text { Sofa...

Exam 14: Installment Buying

Correct Answer
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Match the following terms with their definitions. -Down payment

Correct Answer
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Calculate the finance charge: $\begin{array}{|l|r|r|r|}\hline\text { Sofa purchase } && \text { Number of monthly } & \text {Amount of monthly }\\\text { price } & \text { Down Payment } & \text { payments } & \text { payment }\\\hline\$1,500&\$200&12&\$175\\\hline\end{array}$

Correct Answer
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Match the following terms with their definitions. -Average daily balance

Correct Answer
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John Sullivan bought a new Brunswick boat for $17,000. He made a $2,500 down payment on it. The bank's loan was for 60 months. Finance charges totaled $4,900. His monthly payment is:

Correct Answer
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Able Long buys a new desk for $2,400. Able will pay back $250 per month. Monthly interest is 3% on the unpaid balance. Calculate the balance outstanding after the second payment. (Use the U.S. Rule.)

Correct Answer
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Match the following terms with their definitions. -Truth in Lending Act

Correct Answer
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Most companies calculate the finance charge on credit card accounts as a percentage of the:

Correct Answer
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Amount financed is equal to:

Correct Answer
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The monthly payment is calculated by totaling the finance charge and amount financed and dividing that by the number of payments of the loan.

Correct Answer
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Match the following terms with their definitions. -Revolving charge

Correct Answer
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Correct Answer
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Neal Selznick bought a new van for $10,000. Neal put down $1,000 and paid $275 monthly for 40 months. What is the total amount of finance charge that Neal paid at the end of 40 months?

Correct Answer
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$275 × 40 - ($10,000...
View Answer

The average daily balance is the same as the daily balance.

Correct Answer
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Pete Size read the following partial advertisement: Price $20,999; down payment $1,000; cash or trade; $390.85 per month for 60 months. Calculate (A)the total finance charge and (B)the APR by table lookup.

Correct Answer
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A. $390.85 × 60 - $1...
View Answer

The APR represents the stated interest rate.

Correct Answer
verified

The cost of credit reports would be included in the amount financed.

Correct Answer
verified

Given a mortgage of $48,000 for 15 years with a rate of 11%, what are the total finance charges?

Correct Answer
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Match the following terms with their definitions. -Amount financed

Correct Answer
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Correct Answer
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Exam 14: Installment Buying

Correct AnswerverifiedShow Answer

Match the following terms with their definitions. -Down payment

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

Match the following terms with their definitions. -Average daily balance

Correct AnswerverifiedShow Answer

John Sullivan bought a new Brunswick boat for $17,000. He made a $2,500 down payment on it. The bank's loan was for 60 months. Finance charges totaled $4,900. His monthly payment is:

Correct AnswerverifiedShow Answer

Able Long buys a new desk for $2,400. Able will pay back $250 per month. Monthly interest is 3% on the unpaid balance. Calculate the balance outstanding after the second payment. (Use the U.S. Rule.)

Correct AnswerverifiedShow Answer

Match the following terms with their definitions. -Truth in Lending Act

Correct AnswerverifiedShow Answer

Most companies calculate the finance charge on credit card accounts as a percentage of the:

Correct AnswerverifiedShow Answer

Amount financed is equal to:

Correct AnswerverifiedShow Answer

The monthly payment is calculated by totaling the finance charge and amount financed and dividing that by the number of payments of the loan.

Correct AnswerverifiedShow Answer

Match the following terms with their definitions. -Revolving charge

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

Neal Selznick bought a new van for $10,000. Neal put down $1,000 and paid $275 monthly for 40 months. What is the total amount of finance charge that Neal paid at the end of 40 months?

Correct Answerverified$275 × 40 - ($10,000...View AnswerShow Answer

The average daily balance is the same as the daily balance.

Correct AnswerverifiedShow Answer

Pete Size read the following partial advertisement: Price $20,999; down payment $1,000; cash or trade; $390.85 per month for 60 months. Calculate (A)the total finance charge and (B)the APR by table lookup.

Correct AnswerverifiedA. $390.85 × 60 - $1...View AnswerShow Answer

The APR represents the stated interest rate.

Correct AnswerverifiedShow Answer

The cost of credit reports would be included in the amount financed.

Correct AnswerverifiedShow Answer

Given a mortgage of $48,000 for 15 years with a rate of 11%, what are the total finance charges?

Correct AnswerverifiedShow Answer

Match the following terms with their definitions. -Amount financed

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

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$275 × 40 - ($10,000...
View Answer

Correct Answer
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A. $390.85 × 60 - $1...
View Answer

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