UGBA 135 Final Exam Questions Correctly Answered 2024.
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UGBA 135 Final Exam Questions Correctly Answered is the greatest factor that determines your credit score? - correct answer paying bills on time over time
the "cornerstone" of wealth is? - correct answer being frugal, not cheap but value oriented
what is the minimum criteria for a credit sco...
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UGBA 135 Final
what is the greatest factor that determines your credit score? - correct answer paying bills on time over
time
the "cornerstone" of wealth is? - correct answer being frugal, not cheap but value oriented
what is the minimum criteria for a credit score? - correct answer - at least one reported "account" which
has been open for at least six months
- at least one report that has been reported by a lender in the last six months and nothing that indicates
you're deceased
what is "good debt"? - correct answer taking out loans in order to pay off a car, a mortgage or an
education or starting a business
what is considered "bad debt"? - correct answer borrowing money to support a lifestyle of living beyond
one's means
the rule of 72 - correct answer the number of years it takes for a certain amount to double in value is
equal to 72 divided by its annual rate of interest
what are credit cards, debit cards, charge cards, prepaid cards? - correct answer - credit card: an
unsecured line of credit, based on good faith and credit history, this is a risk for a bank
- debit card: a secured line of credit, the bank is taking no risk in issuing one of these
- charge card: issued by a retailer allowing you to charge purchases made only with their store, store
credit usually carries high rates or interest as high as 20 to 30% on unpaid balances
- prepaid card: offered by banks and non- banks, not linked to one's bank account, entails high fees and
interest
what is the credit card act and most important point? - correct answer 1) No increase interest rates for
12 months unless an intro rate expires
,2) After one year of the intro rate expires the card holder must be notified 45 days in advance of any rate
change
3) If you are more than 60 days late the issuer may charge you the interest default rate, which is typically
28-35%. However, if you make your payments on time for six consecutive months, the original rate must
be restored. Some banks may refund part of the default rate for each month you pay on time as an
incentive to get the account "cleaned up"
4) For an account in good standing, interest rate increases can only be applied to new charges
5) Promotional rate periods must be for a minimum of six months
6) Overdraft fees may not be charged unless the cardholder agrees to allow them. When you "accept"
most modern day contracts you are probably agreeing to overdraft fees. Otherwise the issuer would
reject the charge.
Key point: all these things they have put into effect are for consumers and not busines
what is principle? - correct answer the amount of money that is borrowed or loaned
what is interest? - correct answer the cost of money; paid by the borrower to obtain the used of the
principal or received by the lender for providing the principal; expressed as APR
sometimes you can prepay interest and they will charge you a point (one percent of the loan) and it is
paying your interest in advance and it will usually lower your interest - correct answer true
are social security benefits taxable? - correct answer yes, 85% of them are
what is the first thing you need to start a business? - correct answer an idea
if you start a business, a lender will want you to personally guarantee a loan (i.e. a home) - correct
answer true
who pays for part A of medicare? - correct answer free to seniors who apply; financed by a 2.9% payroll
tax on all earned income; 1.45% employer and 1.45% employee pays
who pays for part B of medicare? - correct answer optional and means tested; financed by monthly
premiums paid by the insured which currently range from about to $134 to $428 per month, based on a
, person's prior year's adjusted gross income; paid directly or deducted from Social Security checks;
partially funded by a 3.8% surtax
who pays for part D of medicare? - correct answer optional and means tested; it is a prescription drug
plan currently provided only by private insurance companies and financed 25% by monthly premiums
from the insured and 75% by taxes
which of the following does not apply to medicare part B and part D? - correct answer additional costs
are covered by social security payroll taxes
tax avoidance - correct answer the legal usage of the tax regime in a single territory to one's own
advantage to reduce the amount of tax that is payable by means that are within the law
ta evasion - correct answer the illegal nonpayment or underpayment of tax
in order to be eligible for social security benefits, you must what? - correct answer be an American
citizen or legal alien; 40 quarters of covered employment; a minimum of earned income in each of those
quarters
at what age are benefits available for social security and medicare? - correct answer 65
are social security and unemployment benefits taxable income? - correct answer yes
if you are the victim of credit card theft, what 's the first thing you should do? - correct answer contact
Transunion, Experian, and Equifax
if you are carrying a balance on a credit card, it calculates your balance on a daily basis - correct answer
true
what is variable rate of interest? - correct answer interest rate that moves up and down based upon a
benchmark interest rate which is not controlled by the lender
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