What impact does interest have on the cost of the purchases you make when using credit?A.Interest has no impact because it is separate from the actual purchase prices.B.Interest can cause the overall cost of your purchases to decrease.C.Interest can cause the overall cost of your purchases to increase.D.Interest has no impact because most credit cards do not charge interest.SUBMITarrow_backPREVIOUS
Question
What impact does interest have on the cost of the purchases you make when using credit?A.Interest has no impact because it is separate from the actual purchase prices.B.Interest can cause the overall cost of your purchases to decrease.C.Interest can cause the overall cost of your purchases to increase.D.Interest has no impact because most credit cards do not charge interest.SUBMITarrow_backPREVIOUS
Solution
C. Interest can cause the overall cost of your purchases to increase.
Here's why: When you use credit to make purchases, you're essentially borrowing money that you promise to pay back. Most credit providers charge interest on this borrowed money. This interest is a percentage of the amount you owe, and it's added to your balance. So, if you don't pay off your balance in full each month, you'll end up owing more than just the cost of your purchases. Over time, this can significantly increase the overall cost of items you buy.
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