WSS UNIT 3 & 4 KEY TERMS REVIEW
CREDIT & DEBT, COLLEGE & CAREER,
INCOME & TAXES EXAM QUESTIONS
AND ANSWERS
Award Letter - Answer-The notification of financial aid award. The letter lists the types
and amounts of financial aid the student is eligible for. To finalize the award package,
the student must sign and return the award letter to the Financial Aid office.
Cost of Attendance - Answer-The total amount it will cost you to go to school (includes
tuition and fees, room and board, as well as personal expenses).
Subsidized Student Loan (Federal) - Answer-A need-based loan from the federal
government, the interest of which is paid for by the U.S. Department of Education while
the borrower is in school and during grace and deferment periods.
Unsubsidized Student Loan (Federal) - Answer-This is a type of federal student loan on
which the government does not pay the interest that accrues while a student is in
school.
Private Student Loans - Answer-These are financed by private companies rather than
the government. Since interest rates and
fees for these loans aren't capped by the government, they cost more than federal
loans.
Grants - Answer-Financial Aid funds from colleges or the federal government, usually
need-based aid, and do not need to be paid back.
Scholarships - Answer-Financial aid that is awarded for merit or talent. These funds do
not have to be paid back.
Room and Board - Answer-The cost of housing and food while attending college or
career school.
Tuition - Answer-A sum of money charged for teaching or instruction by a school,
college, or university.
Delinquency - Answer-Broadly refers to a borrower not being current on his or her
payments
, Deferment - Answer-A period of time were you can apply to NOT PAY on your student
loans. Sometimes you are able to not pay the interest during this period of time (interest
doesn't accrue)
Default (on a loan) - Answer-failure to pay back a loan/stop making payments on a loan.
Car Title Loan - Answer-a high-interest, short term loan of cash for which an automobile
title is required as collateral. If you fail to pay back the loan, you may lose your car.
Pay Day Loans - Answer-An organization that lets you borrow against next paycheck.
There are substantial fees for this service. If this loan is not paid back in short period (2
weeks), it renews with additional fees and interest. Some can result in consumers
paying higher than 100% interest annually.
Credit Card - Answer-A type of revolving credit account issued by a bank that allows
users to finance a purchase and pay back that purchase over time, including interest
added after a grace period of 20-25 days.
Work Study - Answer-A program that allows students to work part time while continuing
their studies.
FAFSA - Answer-Free Application for Federal Student Aid
Opportunity Cost - Answer-Cost of the next best alternative use of money, time, or
resources when one choice is made rather than another.
Financial Aid - Answer-Financial assistance for college or post-secondary training:
scholarships, grants, waiver of fees, loans.
Parent Plus Loan - Answer-Federal college loan borrowed and repaid by a parent on
behalf of a dependent student.
Identity Theft - Answer-the fraudulent acquisition and use of a person's private
identifying information, usually for financial gain.
Scam - Answer-an attempt to trick someone, usually with the intention of stealing
money or private information
Revolving Credit - Answer-credit that is automatically renewed as debts are paid off.
Can be used over an over again up to a set limit.
Installment Credit - Answer-credit used to finance a single high-priced item through a
series of equal payments made over a set period of time,
Loan Term - Answer-The length of time you have to pay off a loan.
CREDIT & DEBT, COLLEGE & CAREER,
INCOME & TAXES EXAM QUESTIONS
AND ANSWERS
Award Letter - Answer-The notification of financial aid award. The letter lists the types
and amounts of financial aid the student is eligible for. To finalize the award package,
the student must sign and return the award letter to the Financial Aid office.
Cost of Attendance - Answer-The total amount it will cost you to go to school (includes
tuition and fees, room and board, as well as personal expenses).
Subsidized Student Loan (Federal) - Answer-A need-based loan from the federal
government, the interest of which is paid for by the U.S. Department of Education while
the borrower is in school and during grace and deferment periods.
Unsubsidized Student Loan (Federal) - Answer-This is a type of federal student loan on
which the government does not pay the interest that accrues while a student is in
school.
Private Student Loans - Answer-These are financed by private companies rather than
the government. Since interest rates and
fees for these loans aren't capped by the government, they cost more than federal
loans.
Grants - Answer-Financial Aid funds from colleges or the federal government, usually
need-based aid, and do not need to be paid back.
Scholarships - Answer-Financial aid that is awarded for merit or talent. These funds do
not have to be paid back.
Room and Board - Answer-The cost of housing and food while attending college or
career school.
Tuition - Answer-A sum of money charged for teaching or instruction by a school,
college, or university.
Delinquency - Answer-Broadly refers to a borrower not being current on his or her
payments
, Deferment - Answer-A period of time were you can apply to NOT PAY on your student
loans. Sometimes you are able to not pay the interest during this period of time (interest
doesn't accrue)
Default (on a loan) - Answer-failure to pay back a loan/stop making payments on a loan.
Car Title Loan - Answer-a high-interest, short term loan of cash for which an automobile
title is required as collateral. If you fail to pay back the loan, you may lose your car.
Pay Day Loans - Answer-An organization that lets you borrow against next paycheck.
There are substantial fees for this service. If this loan is not paid back in short period (2
weeks), it renews with additional fees and interest. Some can result in consumers
paying higher than 100% interest annually.
Credit Card - Answer-A type of revolving credit account issued by a bank that allows
users to finance a purchase and pay back that purchase over time, including interest
added after a grace period of 20-25 days.
Work Study - Answer-A program that allows students to work part time while continuing
their studies.
FAFSA - Answer-Free Application for Federal Student Aid
Opportunity Cost - Answer-Cost of the next best alternative use of money, time, or
resources when one choice is made rather than another.
Financial Aid - Answer-Financial assistance for college or post-secondary training:
scholarships, grants, waiver of fees, loans.
Parent Plus Loan - Answer-Federal college loan borrowed and repaid by a parent on
behalf of a dependent student.
Identity Theft - Answer-the fraudulent acquisition and use of a person's private
identifying information, usually for financial gain.
Scam - Answer-an attempt to trick someone, usually with the intention of stealing
money or private information
Revolving Credit - Answer-credit that is automatically renewed as debts are paid off.
Can be used over an over again up to a set limit.
Installment Credit - Answer-credit used to finance a single high-priced item through a
series of equal payments made over a set period of time,
Loan Term - Answer-The length of time you have to pay off a loan.
