Which of the following methods of calculating finance charges on credit cards is least favorable to the cardholder?
A) Previous balance method
B) Ending balance method
C) Average daily balance method
D) Adjusted balance method

Question

Quizplus · Accepted Answer

The previous balance method is least favorable to the cardholder because it calculates finance charges based on the balance at the beginning of the billing cycle, ignoring any payments made during the cycle. This can result in higher finance charges compared to methods that account for payments or average balances throughout the billing period.

Which of the Following Methods of Calculating Finance Charges on Credit