Credit Management and Credit Scores - Beginner Level Quiz

Question 1
1. What is a credit score?

(A) A rating of a bank's loan products.

(B) A summary of the current balance in your bank account.

(C) A figure that measures overall financial health by considering income, savings, and credit behavior.

(D) A numerical representation of an individual's credit history and reliability.

Question 2
2. Which factor is generally NOT considered when calculating a credit score?

(A) Recent credit inquiries, even though they do have a minor effect.

(B) Your bank account balance.

(C) Payment history.

(D) Outstanding debt amounts.

Question 3
3. Which strategy is most effective for improving a low credit score?

(A) Increasing your credit utilization ratio deliberately.

(B) Closing unused credit card accounts immediately.

(C) Avoiding all forms of new credit entirely.

(D) Paying bills on time consistently.

Question 4
4. When managing a credit card, what is generally recommended to maintain a good credit score?

(A) Regularly charging as much as possible to maximize rewards.

(B) Refraining from paying off the balance to keep the account active.

(C) Making at least the minimum payment on time and paying more when possible.

(D) Always paying only the minimum amount because it shows consistent usage.

Question 5
5. If you have a loan that you are struggling to manage, what is a recommended step in responsible credit management?

(A) Contact your lender to discuss restructuring or consolidation options.

(B) Consolidate all your debts immediately without seeking professional advice.

(C) Apply for additional loans to cover the missed payments.

(D) Ignore missed payments and hope the situation resolves on its own.

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