ECONOMICS (CBSE/UGC NET)

Detailed explanation-1: -Credit ratings are the corporate equivalent of a personal credit score. Instead of the 300-850 scale of an individual FICO score, debts by business or government borrowers are rated on a scale of D to AAA. These credit ratings indicate the likelihood that a borrower can make punctual repayments.

Detailed explanation-2: -A credit score is a number from 300 to 850 that rates a consumer’s creditworthiness. The higher the score, the better a borrower looks to potential lenders. A credit score is based on credit history: number of open accounts, total levels of debt, repayment history, and other factors.

Detailed explanation-3: -Lenders may also use your credit score to set the interest rates and other terms for any credit they offer. Credit scores typically range from 300 to 850. Within that range, scores can usually be placed into one of five categories: poor, fair, good, very good and excellent.

Detailed explanation-4: -Your creditworthiness is also measured by your credit score, which is a three-digit number based on factors in your credit report. A high credit score means your creditworthiness is high and a lower credit score indicates lower creditworthiness.

Detailed explanation-5: -Definition and Examples of “A” Credit The A credit grade generally reflects having a “good” credit score or higher (typically 700 or above) according to the FICO rating systems and others. 1 Sometimes, lenders will designate an additional “A+” for borrowers with the highest scores.