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It can be wise for an inexperienced credit card user to make a large purchase with a credit card.

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True

False

True. The purpose of making such a purchase is to establish credit; the user should make sure to have to funds to pay it off.

Buying a major purchase now instead of later is a perfect way to save money on it.

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True

False

False. Waiting a while might net you a discount that wasnt there earlier, and it may also provide you the means to pay for it (such as with a tax refund).

The definition of "large purchase" is standard and accepted by everyone.

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True

False

False. The definition varies according to people, families, and businesses, often by their economic conditions.

A luxury item is typically a _______.

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Need

Want

Neither

Want. Luxury items are typically not necessities and are therefore wants.

Which of the following are advantages of buying used rather than new?

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You can still get the bells and whistles that you want.

You can afford your major purchase now rather than waiting until you have saved enough.

You can avoid using credit for your purchase.

All of the above

All of the above. There are even more advantages than these; for example, you might still get some kind of a warranty.

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