Question

!2th grade Mathematics for Data and Financial Literacy V22

A borrower has a credit score of 560 and knows the following four scenarios can have a negative or a positive impact:


Paying bills on time
Long credit history
Contacting a debt relief agency
Low percentage of credit available


Which scenario(s) will positively impact a credit score?
I, IV
I, II, III
I, II
III, IV

Answer 1

Scenario I (Paying bills on time) and Scenario II (Long credit history) will positively impact a credit score. These two factors demonstrate responsible financial behavior and stability, which are typically viewed favorably by lenders and credit agencies.

Scenario III (Contacting a debt relief agency) may have a mixed impact on a credit score. While seeking assistance from a debt relief agency may help in managing debts, it can also indicate financial difficulties and may raise concerns for lenders.

Scenario IV (Low percentage of credit available) will generally positively impact a credit score. Having a low percentage of credit available indicates responsible credit utilization, which is a positive factor in credit scoring models.