IXL | Identify advantages and disadvantages of payment methods

Which of the following is an advantage of using a credit card to pay for a sofa?

Credit cards are so easy to use that you must be careful not to spend too much.

You can buy now and pay later.

If you can't pay your monthly credit card bill in full, you may owe interest.

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question

Which of the following is a disadvantage of using a credit card to pay for clothing?

Credit cards are so easy to use that you must be careful not to spend more money than you planned.

If your credit card is lost or destroyed, you automatically lose your money.

Credit cards are easy to carry and use.

key idea

A credit card is a payment card that lets you buy items now and pay for them later. The bank that issues your credit card may charge an annual fee. The bank will also charge interest and late fees if you don't pay your credit card bill on time.

solution

Read each statement to see if it describes a disadvantage of using a credit card.

green checkmark, Credit cards are so easy to use that you must be careful not to spend more money than you planned.

Credit cards are so easy to use that you might lose track of how much you spend. The ability to buy now and pay later may lead you to spend more than you can pay back when your credit card bill is due. This is a disadvantage of paying with a credit card.

red X symbol, If your credit card is lost or destroyed, you automatically lose your money.

If your credit card is lost or destroyed, you can call the bank to have it canceled. You do not automatically lose your money. So, this statement is not true.

red X symbol, Credit cards are easy to carry and use.

Credit cards are small and light, and they are accepted at most businesses. This is an advantage, not a disadvantage, of paying with a credit card.

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