Question

ralph is purchasing a new gaming system for $300.00. he is trying to decide whether he wants to use cash or his credit card to pay. he has $400.00 available in his checking account to pay for the system in full.

which of the following is not an argument that justifies ralphs use of his credit card to purchase the gaming system?
a. if he uses his credit card, he wont have to walk around with $300 in his wallet.
b. with credit, he is not required to pay off his balance for a very long time. thats $300 more in his pocket.
c. ralph can afford to pay off the credit card purchase immediately, and it will help build a good credit rating.
d. if he uses his credit card, it will be easier to pay for extra items (cords and controllers) that he wasnt expecting to have to purchase.

Explanation:

Analyze the scenario

The problem asks us to identify which option is not a valid argument justifying Ralph's use of a credit card to purchase a $300.00 gaming system, given that he has $400.00 cash available in his checking account.

Evaluate option A

Using a credit card provides convenience and safety by eliminating the need to carry large amounts of physical cash. This is a valid argument justifying credit card use, applying the concept of Credit Card Benefits.

Evaluate option B

This statement claims that with credit, one is not required to pay off the balance for a very long time. In reality, credit cards require monthly payments, and carrying a balance over time incurs high interest charges. Believing one can delay payment indefinitely without consequence contradicts Responsible Credit Use. Thus, this is not a valid justifying argument.

Evaluate option C

Since Ralph has $400.00 in his checking account, he can pay off the $300.00 credit card balance immediately when the bill arrives. Doing so avoids interest and helps build a positive credit history. This is a strong, valid argument under Responsible Credit Use.

Evaluate option D

A credit card provides financial flexibility for unexpected emergency purchases or extra accessories at checkout. This is a recognized advantage, representing another aspect of Credit Card Benefits.

Answer:

• a. If he uses his credit card, he won't have to walk around with $300 in his wallet.
• b. With credit, he is not required to pay off his balance for a very long time. That's $300 more in his pocket. (Correct answer)
• c. Ralph can afford to pay off the credit card purchase immediately, and it will help build a good credit rating.
• d. If he uses his credit card, it will be easier to pay for extra items (cords and controllers) that he wasn't expecting to have to purchase.