Question

Which is the best example of a revolving debt?

Paying your bills in full each month.

Financing college.

Paying your utility bill with your checking account

Paying the minimum due on your credit card each month.

Answer 1

Paying the minimum due on your credit card each month.

Answer 2

revolving debt is open termed debt (there is no set end date where you pay off all of your debt)

contrast this with closed term debt where you pay it all off at some point in the future (eg: mortgage)

Answer 3

it's also thought of as a line of credit

Answer 4

JIM!!!!!! :D

Answer 5

so would it be the last one?

Answer 6

https://www.lendingtree.com/glossary/what-is-revolving-debt

that page says: "Revolving debt is the kind of debt that credit cards offer and is usually an easy way to get credit. It can be a useful tool when used with discipline."

Answer 7

so I agree with roz_mar23

Answer 8

thank you to you both:))) i have more aha if you dont mind :/

Answer 9

"Paying the minimum due on your credit card each month." is definitely a bad financial habit though. It means you end up paying more money over time.

Answer 10

sorry @jim_thompson5910 u explained it well. keep up the work :)

Answer 11

When recommending financial tips to friends and family, which of the following can lower your credit score?

carrying balances on credit cards

making late payments

using credit cards when you don’t have enough money in your savings account

all of the above

Answer 12

is it the first one

Answer 13

there is one choice that definitely lowers your credit score

Answer 14

the other two are iffy in my book

Answer 15

do you see which choice I'm referring to?

Answer 16

@rachael_t What do u think can harm a credit score? (think this way... if it goes down it not a good thing)

Answer 17

oh if it goes down its bad?

Answer 18

yeah the lower the credit score, the less likely you'll get credit

Answer 19

all of the above

Answer 20

and a lot of employers check potential employee credit scores

so it also affects job prospects

Answer 21

B is definitely one that lowers it

A and C are iffy to me, but I guess they also lower it too

Answer 22

so if A,B,C do, then it has to be all of the above

Answer 23

You purchase a new table at your local furniture store and decide to pay using your credit card. You plan to pay off this debt within a year. Choose the best credit card choice from the following offers.

22% interest

0% interest for 1 year and 12% interest after that

2% interest

6% interest

Answer 24

any ideas?

Answer 25

b

Answer 26

or c

Answer 27

yep, if everything goes according to plan, then you simply pay back whatever you charged without any extra interest

Answer 28

wait sooo b? aha

Answer 29

yeah

Answer 30

thanks :>

You purchase new furniture and decide to pay using your credit card. You plan to pay off this debt within a year. Choose the best credit card choice from the following offers.

18% interest

27% interest

0% interest for 1 year and 12% interest after that

3% interest

Answer 31

same question more or less

Answer 32

wait....

Answer 33

yah aha

Answer 34

Which of the following credit scores will enable you to get the lowest interest rate on a loan?

750

650

550

450

Answer 35

Rule:

higher credit score = lower interest rate
lower credit score = higher interest rate

Answer 36

so 750 :>

Answer 37

yes

Answer 38

Explain a situation in which revolving debt can change from short-term debt to long-term debt.

Answer 39

one good way to raise your credit score:


step 1) have enough money in the bank (cash). let's say you have $200 in there

step 2) buy something that is less than $200. Say something half that or less. Buy it using a credit card

step 3) as soon as possible, pay off the credit card balance in full. Do not carry a balance from month to month.


Doing this enough will raise your credit score

Answer 40

"Explain a situation in which revolving debt can change from short-term debt to long-term debt."

hint: minimum payments

Answer 41

oh cool :) ill keep that

Answer 42

:/ idk

Answer 43

imagine you borrow $1,000

Answer 44

and let's say the min payment is $10

if you make $10 a month, then it will take 1000/10 = 100 months (just a little over 8 years) to pay off all that debt. I'm not even considering interest so it will take even longer than that

Answer 45

the min payment stretches out the time to pay it back along with the total amount you pay back

Answer 46

ok and thats it?:/ dont really get his one

Answer 47

this

Answer 48

yeah which is why making the min payments is a bad idea

Answer 49

the credit card company loves it though because they get more money

Answer 50

thank you:) one sec let me rewrite it

Answer 51

last one

Answer 52

i got all of them right :>

Answer 53

Your friend is confused about types of debts. Which of the following would most likely help his financial portfolio by adding an appreciating asset?

boat loan

car loan

mortgage

none of the above

Answer 54

Go over your notes from yesterday. I mentioned something about the value depreciating (going down) over time due to use of the item.

Answer 55

mortgage

Answer 56

that depreciates? or appreciates?

Answer 57

none of the above