When Using Credit to Make Purchases, Consumers Are

question 154

Multiple Choice

When using credit to make purchases, consumers are

• A) decreasing current buying power and increasing future buying power.
• B) increasing their present discretionary income to extend purchasing power.
• C) putting themselves at significant risk of financial disaster.
• D) forgoing the accumulation of wealth to increase current income.
• E) increasing current buying power at the expense of future buying power.

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Definitions:

Impose

To enforce or apply a rule, tax, penalty, or restriction.

Settlement

In financial terms, a settlement is the process whereby securities are delivered, usually against in exchange for payment of money, to fulfill contractual obligations, such as those arising from the sale of securities.

Wage Freeze

A policy or condition where an employer decides not to increase the wages of its employees for a certain period, often during economic downturns.

Plant Upgrades

Investments made to improve the efficiency, capacity, or environmental impact of industrial facilities.