Personal Finance - Multiple Choice?

1. Juan goes to the Southern Union Bank to get a loan. Juan has an account at the bank on which he receives 2.2 percent annual interest. The rate of interest he will pay on the loan that he takes out will be:

A. Lower than 2.2 percent

B. Nothing can be known about it, because he has not yet applied

C. Higher than 2.2 percent

D. Equal to 2.2 percent

2. On which of the following loans would one be MOST LIKELY to pay the highest interest rate?

A. A home mortgage loan

B. An automobile loan

C. A credit card

D. A student loan for college

3. John borrows $100 dollars from Ed. They agree that John will pay back the loan in two months at a rate of 10 percent monthly. If John pays back exactly $120, then the interest was:

A. Compounded

B. Simple

C. Usurious

D. Impounded

4. Fred receives a loan for $10,000 that must be repaid in three years. The rate of interest is 5 percent. If the amount of interest that must be repaid is greater than $1,500, what type of interest is Fred paying?

A. Simple

B. Usury

C. Compound

D. Articulated

5. Which of the following would be MOST LIKELY to prevent Marcus from taking this family on a vacation to Disney World?

A. Lower tariffs

B. Rational economic decisions

C. High taxes

D. A decrease in the discount rate

If you do not mind please explain so I can understand a little better. Thank you!

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