Credit - Credit Rating Education Done In Time! | Attempts: 148

2.

A good budget should be very tight; therefore, you can take good control of your money and spend your money more efficiently.

True
False

Correct Answer

A. False

Explanation

A good budget should not necessarily be very tight. While having a tight budget can help control spending and promote efficiency, it is not the only factor that determines a good budget. A good budget should be balanced, realistic, and tailored to individual financial goals and circumstances. It should allow for necessary expenses, savings, and some flexibility for unexpected situations. Therefore, the statement that a good budget should be very tight is false.

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3.

The Canadian Government established plans such as the Canada Pension Plan and Old Age Security that will provide sufficient retirement income for retirees. These retirees do not need to further supplement their retirement income in order to live an ideal lifestyle.

True
False

Correct Answer

A. False

Explanation

The statement is false because while the Canadian Government has established plans like the Canada Pension Plan and Old Age Security, these plans may not provide sufficient retirement income for all retirees to live an ideal lifestyle. Many retirees may need to supplement their retirement income through personal savings, investments, or other sources in order to maintain their desired lifestyle during retirement.

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4.

If John Smith made monthly contributions of $100 towards his TFSA starting in August 2009, what is his total allowable contribution at the beginning of January 2010?

$5,000
$500
$9,500
$10,000
$100

Correct Answer

A. $9,500

Explanation

The Tax-Free Savings Account (TFSA) was introduced in Canada in 2009. From 2009 to 2012, the annual contribution limit was $5,000. Since John started contributing in August 2009, he would have contributed for a total of 5 months in 2009 (August to December). Therefore, his total contribution for 2009 would be $500 (5 months x $100). In January 2010, the contribution limit for 2010 would be added, which is $5,000. So, his total allowable contribution at the beginning of January 2010 would be $9,500 ($500 + $5,000 + $4,000).

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5.

Phishing is?

A typing of fishing technique.
A virus that can steal private information from a PC.
A new social networking technology that promotes the use of fake identity to protect its users.
A process in which a fraudulent website or communication acting as a legitimate entity attempting to acquire private information from its users.
An email that provides a link to a legitimate website, asking you to confirm your personal information.

Correct Answer

A. A process in which a fraudulent website or communication acting as a legitimate entity attempting to acquire private information from its users.

Explanation

Phishing is a process in which a fraudulent website or communication pretends to be a legitimate entity in order to deceive users into providing their private information. This can include personal details such as passwords, credit card numbers, or social security numbers. The intention is to use this information for malicious purposes, such as identity theft or financial fraud.

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6.

Which of the following is NOT a recommended method to reduce the chances of identity theft?

Protect your computer with Anti-virus and Firewall software.
Shred any junk mail that has your name and address.
Give your personal information to only trusted sources.
Delete your Facebook, Twitter, and MySpace account.
Be suspicious of websites that ask you for personal information.

Correct Answer

A. Delete your Facebook, Twitter, and MySpace account.

Explanation

Deleting your Facebook, Twitter, and MySpace account is not a recommended method to reduce the chances of identity theft. While it may reduce the amount of personal information available online, it does not eliminate the risk entirely. Identity theft can still occur through other means, such as data breaches or phishing attacks. It is important to take additional measures, such as protecting your computer with antivirus and firewall software, shredding junk mail, being cautious of websites that ask for personal information, and only giving your personal information to trusted sources.

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7.

As long as I keep my spending to any amounts within my credit limit and pay all my bills in full by the due date, my credit scores will be fine.

True
False

Correct Answer

A. False

Explanation

This statement is false because while keeping spending within the credit limit and paying bills on time are important factors in maintaining a good credit score, they are not the only factors. Other factors such as the length of credit history, types of credit used, and credit utilization ratio also play a role in determining credit scores. Therefore, simply following these two practices may not guarantee that credit scores will be fine.

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8.

What are the 3 most important factors that will influence your credit score?

Your spending history, whether you have declared bankruptcy, and the amount of your outstanding credit balances.
Your marital status, your payment history, and the amount of your outstanding credit balances.
Your payment history, whether you have declared bankruptcy, and the amount of your outstanding credit balances.
Your outstanding balances history, your payment history, and the number of credit cards you have.
Your marital status, the number of credit cards you have and whether you have declared bankruptcy.

Correct Answer

A. Your payment history, whether you have declared bankruptcy, and the amount of your outstanding credit balances.

Explanation

The three most important factors that will influence your credit score are your payment history, whether you have declared bankruptcy, and the amount of your outstanding credit balances. These factors are crucial in determining your creditworthiness and financial responsibility. Your payment history reflects how consistently and timely you make your payments, while bankruptcy indicates a significant financial setback. The amount of your outstanding credit balances shows your level of debt and how well you manage it. These factors are used by credit bureaus to assess your creditworthiness and determine the risk of lending to you.

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9.

Which of these is not true of leasing?

Lower monthly payments
Different dealers may have different rates
Credit history is irrelevant
Rates and terms are negotiable
You may return the car at the end of the lease term

Correct Answer

A. Credit history is irrelevant

Explanation

Your credit score generally determines the interest rate of your lease or finance on the vehicle. Many deals also avoid dealing with borrowers who had been bankrupted.

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10.

When does repayment of a student loan generally start?

Six months after the loan has been cashed
On the end date of study on your loan documents
Not until end of study is declared
Seven months after study end date
Never

Correct Answer

A. Seven months after study end date

Explanation

Student loans repayments start after the grace period stated on your loan documents which is generally six to seven months after your study end date

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11.

Which is the most suitable bank account for students without credit cards?

Savings account
Chequing account
Tax free savings account
Investment account
TFSA account

Correct Answer

A. Chequing account

Explanation

Chequing accounts have higher transaction limits that allow you to make purchases and withdrawals without paying extra fees. This would be most suitable for students who do not yet have a credit card and generally pays with cash and debit.

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Credit - Credit Rating Education Done In Time!

If the balance of your credit card is $10,000, the bank charges you with a 17% interest rate, and the minimum payment is 4% of the outstanding balance, how much interest will you be charged in total if you only pay the required minimum payment every month before you pay off?

A good budget should be very tight; therefore, you can take good control of your money and spend your money more efficiently.

The Canadian Government established plans such as the Canada Pension Plan and Old Age Security that will provide sufficient retirement income for retirees. These retirees do not need to further supplement their retirement income in order to live an ideal lifestyle.

If John Smith made monthly contributions of $100 towards his TFSA starting in August 2009, what is his total allowable contribution at the beginning of January 2010?

Phishing is?

Which of the following is NOT a recommended method to reduce the chances of identity theft?

As long as I keep my spending to any amounts within my credit limit and pay all my bills in full by the due date, my credit scores will be fine.

What are the 3 most important factors that will influence your credit score?

Which of these is not true of leasing?

When does repayment of a student loan generally start?

Which is the most suitable bank account for students without credit cards?