Question

You purchase a new stereo at a local electronics store and decide to pay using your credit card. You
plan to pay off this debt within a year
What is the best credit card choice from these offers?
A. 6% interest
B. 29% interest
C. 22% interest
D. 0% interest for 1 year and 12% interest after that
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Answer 1

Answer:

D. 0% interest for 1 year and 12% interest after that

Explanation:

Since you are purchasing a new stereo and will be paying it off within a year, it will be best to choose a credit card that charges the lowest interest rate in the first year. This will be the one with 0% interest rate for the first year; choice D. After you use it , fully pay off the amount and you can cancel your credit card so you don't get charged the 12% interest rate from year 2 going forward.