Assignment 5

Topics: Credit card, Credit history, Credit, Fair Credit Reporting Act, Personal finance, Credit score / Pages: 7 (1780 words) / Published: Dec 5th, 2014
Assignment 5: Credit and Loans

(25.0 points)

1. If you are borrowing money and paying interest, would you prefer an interest rate that compounds annually, quarterly, or daily? Why? (2-4 sentences. 1.0 points)

If i was borrowing money and paying interest i would prefer that the interest rate was annually. Annually means yearly which means i would only have to pay interest that one time. It might be an expensive amount of money to come up with but at least it’s paid off and you no longer have to deal with it.

2. In your Section_5 folder, navigate to and open the Example_Credit_Report, and then answer the questions below.

a. What is the total balance of Jessie Robinson 's real estate account? (0.5 points)

$19,100.00

b. What is the total balance of Jessie Robinson 's revolving account? (0.5 points)

$500.00

c. Has Jessie Robinson ever applied for bankruptcy? (0.5 points)

No

d. How many creditors have made inquiries about Jessie Robinson 's credit? (0.5 points)

Three

e. Do you think Jessie Robinson usually pays bills on time and in full? (1-2 sentences. 1.0 points)

I do believe that Jessie Robinson pays his bills on time and in full.

f. Do you think Jessie Robinson 's credit score would be great, normal, or poor? Why? (1-3 sentences. 1.0 points)

I think that Jessie Robinson’s credit score would either be normal or great because to me it looks as if he always pays his bills on time and has never filed for bankruptcy.

3. Describe a real or made up but realistic situation in which you would want to use installment credit. (2-4 sentences. 1.0 points)

If a buyer wants to buy regularly from a particular seller against Letter of Credit, instead of opening letter of credit on each transaction the buyer can open one revolving letter of credit. Under this scheme when one consignment is paid, the letter of credit is automatically available for the next consignment.

4. Describe a real or made up but realistic situation in which you would

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