Question

Sarah is buying a new washer and dryer. She has the cash to pay for the appliances. But, she wonders if she should use all of her cash or use a credit card. What advice would you give Sarah?

Use money from savings because large purchases should always be made with cash.

Open a new credit card account because she is offered a new introductory APR.

Use a credit card because the minimum payments will be lower than the cost of the washer and dryer.

Use a credit card because it can offer protection if something should happen to the washer and dryer.

Answer 1

First of all cash are in uniform and accepted by the world.Moreover some shops do not allow credit card facilities due to the risk of bad debts and to increase their cash Flow.In Addition credit card companies charge intereset(usaully described as as an APR figure – Annual Percentage Rate)you will be paying off more than you borrowed, and if you are only making the minimum payments you will be paying off a lot more than you borrowed.
To sum up By using credit cards you are basically borrowing against future earnings, assuming that you will be able to pay off that amount in the future. If you lose your job, become ill etc you may well not be in a position to pay off the amount borrowed. In conlusion i would prefer sarah to buy in the form of cash rather than credit card even though it contains few disadvantages such as some money are not accpetable in some shops.

Answer 2

Thats the answer hope it helped