True or false? Impulse buying is a disadvantage of using credit.

True or false? Impulse buying is a disadvantage of using credit.

• A. True
• B. False

Answer: (A)

Impulse buying refers to the tendency of consumers to make unplanned purchases, often driven by emotions or immediate desires rather than thoughtful decision-making. When using credit, individuals may find it easier to make these spur-of-the-moment purchases since they are not using cash and may not immediately feel the impact of spending. This can lead to accumulating debt and financial strain if impulse buying becomes a habit. The advantage of cash transactions is that they typically require more deliberation, as individuals physically see the money leaving their hands. In contrast, credit allows for a perceived disconnect between spending and financial repercussions, making it more tempting to buy items that were not originally needed or planned for. Thus, identifying impulse buying as a disadvantage of using credit accurately highlights a key behavioral risk associated with credit use.

Impulse buying refers to the tendency of consumers to make unplanned purchases, often driven by emotions or immediate desires rather than thoughtful decision-making. When using credit, individuals may find it easier to make these spur-of-the-moment purchases since they are not using cash and may not immediately feel the impact of spending. This can lead to accumulating debt and financial strain if impulse buying becomes a habit.

The advantage of cash transactions is that they typically require more deliberation, as individuals physically see the money leaving their hands. In contrast, credit allows for a perceived disconnect between spending and financial repercussions, making it more tempting to buy items that were not originally needed or planned for. Thus, identifying impulse buying as a disadvantage of using credit accurately highlights a key behavioral risk associated with credit use.