A good example of open-end credit is:
A) the use of a bank credit card to make a purchase.
B) a mortgage loan from a savings and loan institution.
C) an automobile loan from a credit union.
D) an installment loan from a furniture store.
E) an installment loan for purchasing a major appliance.

Question

Quizplus · Accepted Answer

Using a bank credit card to make a purchase is an example of open-end credit because there is a line of credit that can be used repeatedly, as long as the borrower pays off the balance each month. The other options are all examples of closed-end credit, where a specific loan amount is given and must be repaid according to a specific payment plan.

A Good Example of Open-End Credit Is