Beginning in About 1990,many Credit Card Issuers Began Marketing More

question 48

Essay

Beginning in about 1990,many credit card issuers began marketing more aggressively to college students on the basis that they have considerable future earning potential even though their current income is not very high.Prior to 1990,most credit card issuers required co-signers,who would typically be the student's parent.This has led to far more students incurring excessive debt.This has required some students to work longer hours while in college and to have more debt-related problems after getting out of college.Furthermore,employers are increasingly using credit information in the hiring selection process so that some students' debt problems adversely affect their ability to find a job.Evaluate the propriety of these marketing efforts.

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Definitions:

Salvage Value

The estimated residual value of an asset at the end of its useful life, representing what it could be sold for or its scrap value.

Straight-Line

A depreciation method that equally spreads the cost of an asset over its useful life.

Annual Rate of Return

The yearly profit from an investment, expressed as a percentage of the original investment.

Quantitative Techniques

Mathematical or statistical methods applied for analyzing numerical data, often used in decision-making processes.