Wally Currently Has a Balance of $14,500 on His Credit

question 53

Multiple Choice

Wally currently has a balance of $14,500 on his credit cards and he is having a hard time making the minimum payments on them. He has missed several payments and is now paying the default APR of 29.99%. He and his wife own a nice home with $40,000 in equity. They have $7,500 in a certificate of deposit with a 4% APR. He has come to you in tears asking for advice. What would you tell him to do?

• A) Seek out a non-profit credit counseling company.
• B) Cash out his CD and pay down his credit cards.
• C) Become a convenience user, and maintain just one credit card.
• D) Take out a second equity loan on the house.
• E) All of the above.

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Definitions:

Bitter/Sour Taste

Sensory experiences elicited by certain chemicals that are interpreted by the taste buds as either bitter or sour.

Deprivation

A state where an individual or organism lacks a substance or stimulus that is considered necessary or desirable.

Medial Forebrain Bundle

A neural pathway in the brain that is involved with the sensation of reward as well as various aspects of motivation and emotion.

Dopamine

A neurotransmitter involved in many functions, including reward, motivation, memory, attention, and even regulating body movements.