Question

Which of the following will happen if you miss a monthly credit card payment ?

Answer 1

The correct is option D. If you miss a monthly credit card payment, you will be charged a late fee and you lose reward points.

Further Explanation:

Monthly credit card payment:

Your credit card payment might be determined by taking a percent of the parity toward the part of the bargain cycle and including the month to month money charge. For instance, your base installment is 1% of your parity. Your charge card equalization is $1,000. Your credit card APR is 12% and your money charge for the month is $10.  

Credit card payment work:  

1. Because your card action is accounted for to the credit departments (which doesn't occur with charge cards), utilizing Master cards dependably can enable you to fabricate great credit.  

2. Minimum installment: The measure of your Visa charge that you're required to pay every month, which is normally a little level of your all out parity.  

Credit card payment connected:  

Previously, Master card organizations would apply any sum past the base installment to the offset with the most minimal financing cost. The parity incorporates the head (the amount you charged, took out as a loan or moved to the card) and the intrigue collected that month dependent on the head and any expenses.

Subject: business

Level: High School

Keywords: Monthly credit card payment, Credit card payment work, Credit card payment connected.

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Answer 2

Option D is correct.

If a cardholder misses to monthly credit card payment then he will be charged a late fee and will lose reward points.

Further Explanation:

Credit card: Generally, Credit card is issued by financial institutes such as banks. Credit card is a plastic card that allows the cardholders to borrow the funds from the respective bank and then spend the funds as per their requirements.

A credit card can be used for the purchase of goods and services. Generally, a credit card has a specific limit. It is known as a line of credit (LOC). The cardholder can withdraw or use the funds up to the LOC. The cardholder has to pay the borrowed amount along with interest on the borrowed funds after a specific period of time, which is defined and stated at the time of issuing the credit card.

Consequences of missing a monthly credit card payment:

The issuer of the credit card specifies a monthly payment date, and the cardholder has to make a monthly payment which includes the principal amount and the interest on the principle. When the cardholder makes the payment after the specified date of payment or does not pay the amount then it is considered as a credit card payment failure. When the cardholder fails to pay the monthly payment on time then the issuer of the card can charge late fee for breaking the rules of the credit card agreement.

The issuing bank gives reward points for the one-time payment of the monthly dues. When the cardholder misses the payment, then the cardholder loses the reward points.

Thus, if a cardholder misses to monthly credit card payment, then he will be charged a late fee and will lose reward points.

A.

You will be charged a late fee: This is an incorrect option.

The cardholder will also lose reward points for missing the monthly credit card payment.

B.

You lose reward points: This is an incorrect option.

The cardholder will also be charged a late fee for missing the monthly credit card payment.

C.

Your APR will increase the next month: This is an incorrect option.

The annual percentage rate is the rate of the fee charged on the credit card. It remains the same even in the case of the failure in the credit card payment.

D.

Both A & B: This is the correct option.

The cardholder will be charged a late fee and will lose reward points for the failure of the monthly payment.

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Answer details:

Grade: High School

Subject: Business Studies

Chapter: Money and Banking

Keywords: Credit card, Charges, Credit card charges, Credit card company, minimum payments, monthly, credit card payment, late fee, reward points, APR, Annual percentage rate, next month,  both A & B.