Question

Lynn is at a store and wants to buy a new backpack that costs $55. she only has $35 with her, but she has the rest at home. lynn also has a credit card that does not charge her any interest if she pays the balance in full by the end of the month. why might lynn want to wait until she has $55 in cash at the store to purchase the backpack, instead of using her credit card?

Answers

  1. Lynn wants to wait because (D) she would likely have to pay more than $55 at the time of purchase for the convenience of using her credit card.

    What is a credit card?

    • A credit card is a payment card that is issued to users (cardholders) to allow them to pay merchants for products and services based on the cardholder’s incurred debt (i.e., promise to the card issuer to pay them for the amounts plus the other agreed charges).
    • The card issuer (typically a bank or credit union) opens a revolving account and offers the cardholder a line of credit, from which the cardholder can borrow money to pay a merchant or for a cash advance.
    The answer to why Lynn wants to wait would be:
    • The answer will be (D) she would likely have to pay more than $55 at the time of purchase for the convenience of using her credit card.
    • A and B don’t make sense, because who cares about what happens to the store’s money, and C can’t be true because we don’t know what kind of a person Lynn is.
    • Most people don’t forget to pay their bills.
    Therefore, Lynn wants to wait because (D) she would likely have to pay more than $55 at the time of purchase for the convenience of using her credit card.
    Know more about a credit card here:
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    The complete question is shown below:
    Lynn is at a store and wants to buy a new backpack that costs $55. she only has $35 with her, but she has the rest at home. Lynn also has a credit card that does not charge her any interest if she pays the balance in full by the end of the month. why might Lynn want to wait until she has $55 in cash at the store to purchase the backpack, instead of using her credit card?
    a. Using a credit would cause the store to lose money because even if she pays back her bill in full, she will still need to pay the credit card company additional dollars for the convenience of borrowing money.
    b. Using cash would cause the store to lose a large amount of money because credit card companies offer incentives to stores based on the number of people who use their cards.
    c. She might forget to pay the credit card bill, which would make her purchase more expensive due to interest payments and late charges.
    d. She would likely have to pay more than $55 at the time of purchase for the convenience of using her credit card.

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