Question

State with reasons whether the following statement true of false.
Credit cards are used for cash payments.

Options

• True 

• False 

Answer 1

Credit cards are used for cash payments: False
Explanation:
The statement is false. Credit cards are used for making payments on credit. When a person uses a credit card to purchase goods and services, there is no physical exchange of money. However, the amount is paid to the seller by the card-issuing bank; that is, the seller’s account is credited and the cardholder’s account is debited.