A Good Rule of Thumb Is to Limit Consumer Credit

question 44

True/False

A good rule of thumb is to limit consumer credit payments to 30% of your net (after-tax) income.

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Definitions:

Oral Auction

A public sale where goods or services are sold to the highest bidder through verbal bids.

Second-Price Auction

See Vickrey auction.

Vickrey Auction

A sealed-bid auction where the winner pays the second-highest bid instead of their own, encouraging true value bidding.

Highest Bidder

The person or entity willing to pay the most in a bidding process, typically in auctions.