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The Cost of Building on Credit is a free printable Grade 3 to Grade 5 social studies worksheet on what an interest rate is, aligned to Common Core standard D2.Eco.10.3-5. It prints 8 questions with an answer key on its own sheet of paper, in 25 versions that each ask different questions, so no two pupils in the class work from the same page. Print it from the browser or download it as a PDF — no account, no email.

Set 5 of 25 · the same problems every time you open this link.

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Set 1 has all 25 in a single PDF. All 25 sets ask different questions.

The Cost of Building on Credit

D2.Eco.10.3-5

NameDate

Circle the best answer.

1.Why might a government be charged less than a company?
  • A.Governments are larger
  • B.It is more likely to repay, so the risk is lower
  • C.Companies pay tax
2.What does an interest rate measure?
  • A.The size of the lender
  • B.The length of the loan
  • C.The cost of borrowing as a share of the amount borrowed
3.A family borrows to buy rather than wait seven years. What is the risk?
  • A.The debt and its interest remain whatever happens to their income
  • B.The house may move
  • C.Rates cannot change
4.Why does a lender charge interest at all?
  • A.The money could have earned elsewhere while it was lent
  • B.To discourage borrowing
  • C.Because notes wear out
5.A government issues bonds. Who receives the interest?
  • A.The builders
  • B.The people who lent by buying the bonds
  • C.The government
6.Rates rise sharply. What happens to a building programme funded by borrowing?
  • A.Nothing changes
  • B.Each home costs more to finance, so fewer can be built
  • C.Bricks get cheaper
7.Why is a rate expressed as a share rather than a sum?
  • A.Sums are secret
  • B.Shares are shorter
  • C.So loans of different sizes can be compared
8.The white paper says cost falls on borrowing. What does borrowing cost?
  • A.A fixed fee
  • B.Interest, on top of repaying what was borrowed
  • C.Nothing, if a government borrows

LessonPrint · D2.Eco.10.3-5 · Set 5 · free to copy for classroom use

Answer key — The Cost of Building on Credit

Set 5. Prints on its own sheet.

  1. 1.It is more likely to repay, so the risk is lower
  2. 2.The cost of borrowing as a share of the amount borrowed
  3. 3.The debt and its interest remain whatever happens to their income
  4. 4.The money could have earned elsewhere while it was lent
  5. 5.The people who lent by buying the bonds
  6. 6.Each home costs more to finance, so fewer can be built
  7. 7.So loans of different sizes can be compared
  8. 8.Interest, on top of repaying what was borrowed

More practice for D2.Eco.10.3-5

Explain what an interest rate is.

Teaching this next? The Cost of Building on Credit is the 55-minute plan for it, with the misconceptions to expect.

All Grade 3 to Grade 5 worksheets

Last reviewed 2026-09-05. Aligned to D2.Eco.10.3-5 of the C3 Framework for Social Studies State Standards.