All categories

3 years ago

Which best explains what a credit score represents?

2 answers:

4 0

A credit score can range from 350 to 850 and is a numerical rating that can show how good of a payer you are of credit. In order to increase your credit score, you must not miss payments on credit cards, important bills, and student loans. You must also have multiple accounts open which you keep low balances on and pay on time.

Neporo4naja [7]3 years ago

4 0

The correct option is (B).

A numerical rating that expresses how likely you are to repay your debits best defines the credit score.

Further Explanation:

Credit score: A credit score represents the creditworthiness of an individual based on their financial transaction history. If a person has a sound and on-time payment records, then he would have a high credit score and vice versa.

Low credit score means that a person is not paying their bills and dues on time. The credit score is used by the lenders to assess the capability of the borrower to repay the debt. Generally, lenders do not prefer to lend money to the person with a low credit score.

Justification for the correct and incorrect options:

A number showing how likely you are to have more than one credit card: It is an incorrect option. Credit score does not tell about the number of credit cards.

A numerical rating that expresses how likely you are to repay your debits:This is the correct option. Credit score defines the creditworthiness of a person.

A numerical rating that shows how much money you have in your bank account: This is an incorrect option. Credit score does not have any relation with the bank account balance.

A number expressing your yearly income:This is an incorrect option. The level of income and credit score are not directly related.

Learn more:

1. 1Learn more about the credit card balance

brainly.com/question/6453895

2. Learn more about low credit card score

brainly.com/question/2828467

3. Learn more about various approaches to increase the credit score

brainly.com/question/6846931

Answer details:

Grade: Senior School

Subject: Business studies

Chapter: Money & Banking

Keywords:best, explains, credit score, represents, number, showing, likely, more, than, one credit card, numerical rating, expresses, repay, debits, numerical, rating, shows, money bank account, number expressing, yearly income.

You might be interested in

Why is real GDP a more accurate measure of an economy's production than nominal GDP? Nominal GDP is adjusted for the effects of

ad-work [718]

Answer:

Real GDP is not influenced by price changes, but nominal GDP is.

Explanation:

Real gross domestic product (Real GDP) is a measure of gross domestic product "in volume", that is, measured at constant prices. Changes in GDP linked to price variations (inflation or fall in prices) are thus neutralized, which allows a measure of economic growth.

Real GDP is only used in practice to measure GDP growth from year to year, with nominal GDP remaining the benchmark measure for long-term data.

4 0

3 years ago

The ratio of the percentage change in a dependent variable to the percentage change in an independent variable, all other things

Drupady [299]

The ratio of the percentage change in a dependent variable to the percentage change in an independent variable, all other things unchanged, is Elasticity

6 0

4 years ago

Myriad Solutions, Inc. issued 10% bonds, dated January 1, with a face amount of $320 million on January 1, 2021, for $283,294,72

otez555 [7]

Answer:

The net amount of the liability Myriad would report in its balance sheet at December 31, 2021 is $287,524,896

Explanation:

First, we need to determine the amount of discount on the bond at the time of issuance

Discount on Bond = Face value - Issuance value = $320,000,000 - $283,294,720 = $36,705,280

June 30, 2021

Now we will use the effective interest method to calculate the amortization of discount on the bond.

Amortization of Discount = ( Carrying Value x Market yield ) - ( Face value x Coupon rate ) = ( $283,294,720 x 12% ) - ( $320,000,000 x 10% ) = $33,995,366.4 - $32,000,000 = $1,995,366.4 = $1,995,366

Carrying value = $283,294,720 + $1,995,366 = $285,290,086

December 31, 2021

Now we will use the effective interest method to calculate the amortization of discount on the bond.

Amortization of Discount = ( Carrying Value x Market yield ) - ( Face value x Coupon rate ) = ( $285,290,086 x 12% ) - ( $320,000,000 x 10% ) = $34,234,810.32 - $32,000,000 = $2,234,810.32 = $2,234,810

Carrying value = $285,290,086 + $2,234,810 = $287,524,896

5 0

3 years ago

Which of the following statements about the relationship between interest rates and bond prices is true? I) There is an inverse

BaLLatris [955]

Answer: A. I and IV only

Explanation:

The relationship between bond prices and interest is an inverse one. This is because bonds have fixed rates so when for instance interest rates increase, the fixed rate of bonds will become less attractive as people would want to make the higher interest. They will therefore demand less of bonds and the prices will drop. The reverse is true.

Also, long term bonds are more affected by interest rate changes then short term bonds. This is because, as they have a longer term till maturity, they will be even less attractive when interest rates rise.

7 0

3 years ago

A potential customer for an $88,000 fire insurance policy possesses a home in an area that, according to experience, may sustain

Ksenya-84 [330]

Answer:

The answer is: In order for the company to break even on all the $88,000 policies in that area it must charge $528 per yearly policy.

Explanation:

In order to calculate what premium the insurance company should charge in order to break even, we must know how much money the company will have to pay during the year.

Fire insurance policy of $88,000

Possible losses Probability Money paid by company

total loss 0.001 $88,000

50% loss 0.01 $44,000

The company will have to pay $88 ($88,000 x 0.001) for a total loss and $440 ($44,000 x 0.01) for a 50% loss, we add them up and get $528.

In order for the company to break even on all the $88,000 policies in that area it must charge $528 per yearly policy.

8 0

3 years ago