It is better to use your savings instead of borrowing to make a purchase when:
A)the borrower has adequate savings.
B)interest rates are rising.
C)interest rates are falling.
D)the cost of borrowing is greater than the interest earned on savings.
E)the interest earned on savings is greater than the interest paid on the loan.

Question

Quizplus · Accepted Answer

When the cost of borrowing is greater than the interest earned on savings, it is financially better to use your savings instead of borrowing. Borrowing can cost you more in the long run due to interest charges, while using your savings can still allow you to make the purchase without accruing additional debt.

It Is Better to Use Your Savings Instead of Borrowing