Consumers Whose Debt Burden Has Become Very Heavy Might Apply

question 142

Multiple Choice

Consumers whose debt burden has become very heavy might apply for a(n)

• A)personal loan.
• B)single payment loan.
• C)buy-down loan.
• D)consolidation loan.
• E)interim financing.

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Definitions:

Mental Accounting

A concept in behavioral economics where individuals categorize and treat money differently based on subjective criteria, often leading to irrational financial decisions.

Retirement Account

A financial account designed for saving money towards retirement, often offering tax benefits.

Contributions

Payments or services provided by individuals or organizations towards a common fund or cause, often used in the context of charitable donations or participation in joint projects.

Loss Aversion

A concept in behavioral economics indicating that people tend to prefer avoiding losses to acquiring equivalent gains; it's the idea that the pain of losing is psychologically about twice as powerful as the pleasure of gaining.