Question

question 10 points 2
what is the major difference between charge cards and credit cards?

○ charge cards can only be used at one business or a chain of businesses, and credit cards can be used at many different businesses.

○ charge cards can only be used if the account is current, and credit cards can be used if the account is delinquent.

○ charge cards have a fixed line of credit, and credit cards have an unlimited line of credit.

○ charge cards have an unlimited line of credit, and credit cards have a fixed line of credit.

Explanation:

1. Analyze Option 1: Store - specific cards (like some store - only cards) are limited to one or a chain of businesses, but charge cards (e.g., American Express charge cards) are not store - specific. So this is incorrect.
2. Analyze Option 2: Both charge and credit cards have usage restrictions related to account status. A delinquent credit card account will have restrictions on usage, so this is incorrect.
3. Analyze Option 3: Charge cards typically require full payment each month, so they don't have a "fixed line of credit" in the traditional sense, and credit cards have a pre - set (fixed) credit limit. So this is incorrect.
4. Analyze Option 4: Charge cards generally have no pre - set spending limit (unlimited line of credit in terms of the way you use it, though you have to pay in full), while credit cards have a fixed credit limit (the maximum you can borrow). This matches the major difference between charge and credit cards.

Answer:

D. Charge cards have an unlimited line of credit, and credit cards have a fixed line of credit.