Credit Card Companies Use a Set of Complex Matrices to Determine

question 69

True/False

Credit card companies use a set of complex matrices to determine your limit,based on your credit score,net income,debt-to-income ratio,disposable income,and default risk.

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Definitions:

Net Book Value

The value at which an asset is carried on a balance sheet, calculated as the asset's original cost minus accumulated depreciation and impairments.

Accelerated Depreciation

A method of depreciation where assets lose value at a faster rate in the initial years of their life.

Straight-Line Depreciation

A method of calculating the depreciation of an asset that allocates an equal amount of depreciation each year over the asset's useful life.

Depreciation Expense

The allocation of the cost of a tangible asset over its useful life, reflecting the decline in value over time.