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makkiz [27]
3 years ago
14

Why does the credit card company set the minimum payment so low

Business
1 answer:
Illusion [34]3 years ago
5 0

Answer:

To increase profit from interests by increasing duration of balance repayment.

Explanation:

The purpose of every business is to make profits and the reason why every credit card company includes a minimum payment is not just to make it easier to pay but by only making minimum payments, credit card holders could be kept as customers and paying interests on debt for longer.

Secondly, the more the periods the more likely you'll default on some of them and pay penalty fees which means additional income for the companies

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Assume again that the cost of capital is 7 percent and the effective tax rate is 40 percent. How would the payback, internal rat
vfiekz [6]

Answer:

If the effective tax rate increases then the net savings coming from investments will get lowered as a result the investment will have higher payback period (The increase in effective tax rate would lower demand of the product which means there is decline in net saving arising from the sale of the product). Likewise this decrease in annual net savings will also decrease the internal rate of return which shows that their are increased chances of project rejections. The NPV method is based on cash flows and relevant costing just like IRR and payback method but the only difference is that it assumes that the cash earned would be reinvested at cost of capital. The NPV will also decrease due to increased effective tax rate.

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3 years ago
Devon forgets to pay his credit card bill for three months. Which of the following statements is TRUE?
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It is has to be option 4.
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2 years ago
Consider a bakery in your community. Ingredients such as sugar and butter would be examples of _____ costs.
scoray [572]

Ingredients such as sugar and butter would be examples of variable costs.

Fixed costs are cost that remain constant no matter the amount of output. Fixed costs examples are rent, loan, salaries.

Variable costs are cost which change with a change in output as the business provides more services. Variable cost examples are cost of raw materials, commissions and so on.

Find out more at: brainly.com/question/14083670

5 0
2 years ago
Josh is walking to ben hill griffin stadium on gameday when a coca-cola representative offers him and his friends free cans of t
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5 0
3 years ago
Read 2 more answers
If the current price of a product is above the market equilibrium​ price, there is​ ________ of this product.
lana [24]

Answer:

Excess supply

Explanation:

Equilibrium price is the price where the demand curve equals the supply curve.

When price is above the equilibrium price, quantity supplied increases.

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If price is below the equilibrium price, there would be excess demand.

I hope my answer helps you

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3 years ago
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