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Understanding Credit

Question 5 • Personal Finance - EL3403

The balance on your credit card is close to the credit limit. increasedecreaseno effect

Answer
A
increase
B
decrease
C
no effect

Explanation

A credit card balance close to its limit means you are using a large share of your available credit. High credit utilization can lower your credit score, so the effect is to decrease it. The correct choice is decrease.

AI-written and checked against the verified answer.

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