Why Is It Important to Carefully Consider Your Credit Cards

question 41

Multiple Choice

Why is it important to carefully consider your credit cards when developing a budget, financial plan and personal financial objectives?

• A) You should include more than the minimum payments in the budget to pay off the balances as soon as possible and minimize interest expense.
• B) Evaluate relative interest rates of all cards and other loans, and investments to understand how best to prioritize payments and decide on best use of excess cash flow.
• C) A financial plan should really focus on investing excess cash flow for retirement.
• D) Both A and B are correct.

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Definitions:

Joint Venture

A business arrangement in which two or more parties agree to pool their resources for the purpose of accomplishing a specific task or business activity.

Greenfield Operations

Business ventures that start from scratch in a new territory or market, without any prior operations or constraints.

Consortium

A group of companies or institutions that collaborate together to undertake an enterprise or mission that is beyond the capabilities of any single member.

"Make" Tactic

A strategy where a company decides to produce its products in-house rather than outsourcing.