Question

Solomon is a college student who needs a good-quality computer for his schoolwork. He wants to apply for a credit card to cover the cost. Solomon is considering two different cards. One card has an APR of 12% while the other card has a variable APR between 10% and 15%.

What other information does Solomon need to make an informed decision?

the taxes associated with each card
the late fees associated with each card
the type of collateral associated with each card
the annual percentage rate associated with each card

Answer 1

To make an informed decision about which credit card to choose, Solomon should consider the following types of information:

1. **The late fees associated with each card**: Knowing the late fees is important because if Solomon misses a payment, he wants to understand how much that will cost him in addition to the interest charges.

2. **The variable APR details of the second card**: It's important to understand the conditions under which the APR might increase, and how often it can change. This will impact his total repayment amount over time.

3. **Any additional fees**: Besides late fees, he should also find out about any annual fees, foreign transaction fees, or purchase fees that may be associated with the cards.

4. **Grace period**: Understanding the grace period (if any) for avoiding interest charges on purchases can influence his decision depending on his repayment plans.

5. **Rewards or benefits**: If either card offers rewards programs, cashback, or other benefits, that could make a difference in his decision.

6. **Payment flexibility**: Information on payment systems, such as whether they allow for easy online payments or have other conveniences, can also be a factor.

In this context, the **late fees associated with each card** is the most relevant additional piece of information Solomon would need to consider when making his decision.