Introduction to Business

Section 1: Applying for Credit

Self-Checks

1
The ________ (APR) determines the cost of credit on a yearly basis.
A)annual percentage rate
B)annual percentage ratio
C)average percentage rate
D)average percentage ratio
2
A ________ advance is a loan given in cash by a credit card company in anticipation of the borrower's being able to repay it.
A)cash
B)payday
C)quick
D)trust
3
A ________ is someone who agrees to be responsible for a debt if the main applicant does not repay it.
A)co-op
B)co-payer
C)concierge
D)cosigner
4
A fee that is charged when a credit card payment is after the due date is called a(n) ________ .
A)interest charge
B)late-payment fee
C)no-grace fee
D)slow-pay charge
5
The loan applicant's ability to repay a loan is called ________ .
A)capacity
B)capital
C)cash on hand
D)collateral
6
Proof of a loan applicant's trustworthiness to repay debts is called ________ .
A)cash on hand
B)character
C)competence
D)correctness
7
The amount of money the applicant has beyond his or her debts is called ________ .
A)capacity
B)capital
C)cash on hand
D)credit
8
If a person pays his or her bills on time, most creditors will raise the person's ________ .
A)annual fee
B)credit limit
C)interest rate
D)minimum payment
9
The minimum payment is the amount a credit cardholder ________ .
A)actually pays each month
B)can afford pay
C)has a legal obligation to pay
D)plans to pay
10
The maximum amount a credit card holder can charge on a credit card is called the ________ .
A)ceiling
B)credit limit
C)high point
D)max out
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