H&R Block Challenge Test Questions
With Correct Detailed Answers.
interest rate - ANSWER- the amount you pay or earn for borrowing or loaning money
compound interest - ANSWER- interest on interest, basically interest plus time equals
interest on your interest which equals increasing amounts of money
NSF fee - ANSWER- charged by the bank because you do not have enough money to
cover the check/charge
returned check fee - ANSWER- charged by the person/company you wrote the
check/made the debit card charge because you did not have sufficient funds to cover
the check/charge
overdraft protection - ANSWER- feature you can get on a bank checking count that links
your checking account to your credit card/savings account. if you have check/charge
bounce, the bank will charge you a small fee and use your credit card/savings account
to cover the check/charge
credit utilization - ANSWER- the percentage of your credit you are using
credit utilization percent - ANSWER- the total amount you owe divided by the total
amount of your credit
which two factors determine 70% of your credit rating? - ANSWER- credit card
utilization % and your payment history
what is a credit report? - ANSWER- how much you owe and how much credit you have.
7 year history of your payments and any loans you have as well as any unpaid taxes
you have been sued for (tax lien) and now have your wages taken right out of your
check which is bankruptcy
who is responsible for checking the accuracy of your credit report? - ANSWER- you
how long does negative information remain on your credit record? - ANSWER- 7 years
what sort of jobs will possibly not hire you if you have a poor credit rating? why? -
ANSWER- financial industry because they fear you will steal or commit fraud.
government and law enforcement because they fear you will sell secrets and take
bribes
, how does your credit score affect your costs and interest rate for borrowing? -
ANSWER- just like with scales, the higher your credit the lower your costs, the lower
your credit, the higher your costs. they work together in tandem.
what is the best way to build your credit? - ANSWER- get a credit card at 18, charge
19%-30% of your credit limit per month, pay it all off every month on time.
inflation - ANSWER- an increase in the price of good or services. it is the tendency in a
healthy economy for good and services to gradually increase in price over time
mutal fund - ANSWER- a portfolio (basket/group) of stocks managed (bought, sold and
held) by a real live person or a team of people. higher fees and expenses
index fund - ANSWER- a portfolio of stocks typically managed by a computer program.
it buys a particular kind of stock or a slice of the whole stock market. very low fees. this
is your best choice for retirement when you are young because it is easy, cheap, and
performs very well.
bonds - ANSWER- a relatively safe and cheap investment but it does not grow your
money very well. good choice after you retire. a tiny piece of government debt - a city,
state, or the federal government will borrow money to build something
stocks - ANSWER- tiny piece of a company
dividend - ANSWER- you portion of the proft the company made that year. older larger
companies are the ones that pay dividends
potential consequential for not having car insurance - ANSWER- car insurance: you'll
pay for the repair of your car, any injuries you sustain. if it's your fault, you will pay for
the injuries of your passengers and all the people in the other car,a as well as repairs to
the other car. if the police are called, you'll be ticketed, your car may be impounded, and
you may be arrested. you can be sued for any damages you can't pay and the judges
may garnish your wages until the money is paid off. also, your car insurance increases
dramatically if you allow it to lapse
just pulled over by the police: get a ticket, car may be impounded, and you may be
arrested. car insurance will increase dramatically
decuctibile - ANSWER- the money that is your responsibility to pay if you must make an
insurance claim.
liability vs full coverage - ANSWER- liability: only covers the other cars and people
(required by law)
full coverage: covers your car, and your passengers, and the other cars and people
With Correct Detailed Answers.
interest rate - ANSWER- the amount you pay or earn for borrowing or loaning money
compound interest - ANSWER- interest on interest, basically interest plus time equals
interest on your interest which equals increasing amounts of money
NSF fee - ANSWER- charged by the bank because you do not have enough money to
cover the check/charge
returned check fee - ANSWER- charged by the person/company you wrote the
check/made the debit card charge because you did not have sufficient funds to cover
the check/charge
overdraft protection - ANSWER- feature you can get on a bank checking count that links
your checking account to your credit card/savings account. if you have check/charge
bounce, the bank will charge you a small fee and use your credit card/savings account
to cover the check/charge
credit utilization - ANSWER- the percentage of your credit you are using
credit utilization percent - ANSWER- the total amount you owe divided by the total
amount of your credit
which two factors determine 70% of your credit rating? - ANSWER- credit card
utilization % and your payment history
what is a credit report? - ANSWER- how much you owe and how much credit you have.
7 year history of your payments and any loans you have as well as any unpaid taxes
you have been sued for (tax lien) and now have your wages taken right out of your
check which is bankruptcy
who is responsible for checking the accuracy of your credit report? - ANSWER- you
how long does negative information remain on your credit record? - ANSWER- 7 years
what sort of jobs will possibly not hire you if you have a poor credit rating? why? -
ANSWER- financial industry because they fear you will steal or commit fraud.
government and law enforcement because they fear you will sell secrets and take
bribes
, how does your credit score affect your costs and interest rate for borrowing? -
ANSWER- just like with scales, the higher your credit the lower your costs, the lower
your credit, the higher your costs. they work together in tandem.
what is the best way to build your credit? - ANSWER- get a credit card at 18, charge
19%-30% of your credit limit per month, pay it all off every month on time.
inflation - ANSWER- an increase in the price of good or services. it is the tendency in a
healthy economy for good and services to gradually increase in price over time
mutal fund - ANSWER- a portfolio (basket/group) of stocks managed (bought, sold and
held) by a real live person or a team of people. higher fees and expenses
index fund - ANSWER- a portfolio of stocks typically managed by a computer program.
it buys a particular kind of stock or a slice of the whole stock market. very low fees. this
is your best choice for retirement when you are young because it is easy, cheap, and
performs very well.
bonds - ANSWER- a relatively safe and cheap investment but it does not grow your
money very well. good choice after you retire. a tiny piece of government debt - a city,
state, or the federal government will borrow money to build something
stocks - ANSWER- tiny piece of a company
dividend - ANSWER- you portion of the proft the company made that year. older larger
companies are the ones that pay dividends
potential consequential for not having car insurance - ANSWER- car insurance: you'll
pay for the repair of your car, any injuries you sustain. if it's your fault, you will pay for
the injuries of your passengers and all the people in the other car,a as well as repairs to
the other car. if the police are called, you'll be ticketed, your car may be impounded, and
you may be arrested. you can be sued for any damages you can't pay and the judges
may garnish your wages until the money is paid off. also, your car insurance increases
dramatically if you allow it to lapse
just pulled over by the police: get a ticket, car may be impounded, and you may be
arrested. car insurance will increase dramatically
decuctibile - ANSWER- the money that is your responsibility to pay if you must make an
insurance claim.
liability vs full coverage - ANSWER- liability: only covers the other cars and people
(required by law)
full coverage: covers your car, and your passengers, and the other cars and people
