ECONOMICS
CREDIT
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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A card that allows an individual to pay for merchandise or services by borrowing against a line of credit.
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A card that has a set balance that you can only use at one place.
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A card with the money from your checking account.
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None of the above
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Detailed explanation-1: -A credit card is a payment card issued to users (cardholders) to enable the cardholder to pay a merchant for goods and services based on the cardholder’s accrued debt (i.e., promise to the card issuer to pay them for the amounts plus the other agreed charges).
Detailed explanation-2: -Rewards credit cards. Secured credit cards. Low-interest credit cards. Cashback credit cards.
Detailed explanation-3: -What is a credit line card? A credit line card is similar to an unsecured loan. This type of card allows you to borrow a small amount of money on a revolving basis without actually requiring you to apply for a loan. Moreover, you only need to pay interest on the capital utilised instead of the entire credit available.
Detailed explanation-4: -There are three types of credit card accounts: bank-issued credit cards (such as Visa and MasterCard), store/priority cards (such as the Bay and Sears) and travel/entertainment cards, also called charge cards (such as American Express or Diner’s Club).
Detailed explanation-5: -The use of a credit card means that the bank (or other financial institution) is making a loan or providing credit to the cardholder.