Jose wants to be sure he maintains a high credit score as he is planning to buy a new car soon. What should he do to ensure his score stays high, allowing him to buy his dream car?
A. Open a savings account at the local bank.
B. Pay off his credit card balance each month.
C. Test drive several cars before deciding which to buy.
D. All are things he should do to increase or maintain his credit score.

The correct option is B.
To maintain a high credit score, one has to pay off his credit card balance every month. Non payment of credit balance have negative effects on one's credit reputation and this can have adverse effects on one's financial records. Non payment also increases the amount of interest that one will pay on the money and this also increases one's debts.

Answer Link

Ritushar Ritushar · Answer 2 · 2019-08-23T12:02:21+02:00

Option (B) is correct.

Jose should pay off his credit card balances each month to maintain a high credit score.

Further Explanation:

Credit score: A credit score refers to a number that represents the creditworthiness of an individual based on their financial transaction history. If a person has a sound and on-time payment records, then he would have a high credit score and vice versa.

Low credit score means that a person is not paying their bills and dues on time. The credit score is used by the lenders to assess the capability of the borrower to repay the debt. Generally, lenders do not prefer to lend money to the person with a low credit score.

Maintaining a high credit score: In the current case, Jose wants to buy a car on credit. The seller will only sell the car when Jose will have a strong credit score. Jose has to pay all his credit dues on time in order to have a high credit score and buy the car on credit.

Justification for the correct and incorrect option:

A.

Open a savings account at the local bank: This is an incorrect option.

Opening a saving account will not help in increasing the credit score.

B.

Pay off his credit card balance each month: This is the correct option.

Paying the credit card score will increase the creditworthiness of Jose.

C.

Tests drive several cars before deciding which to buy: This is an incorrect option.

The car seller will not allow Jose to buy the car on the basis of test drives.

D.

All are things he should do to increase or maintain his credit score: This is an incorrect option.

Jose should only pay off his credit balance in order to maintain a good credit score.

Learn more:

Learn more about the factor to increase the credit card APR

https://brainly.com/question/1218973

Learn more about the factors that may hurt the credit score

https://brainly.com/question/2828467

Learn more about missing the monthly credit card payment

https://brainly.com/question/3211811

Answer details:

Grade: High School

Subject: Business Studies

Chapter: Money and Banking

Keywords: Jose, wants, to be sure, maintain, a high credit score, planning, buy, a new car soon, ensure, score stay high, buy dream car, open a saving account, local bank, pay off, credit card balance, each month, test drive, several cars, before deciding, buy, All are things, should do, increase or maintain, credit score.