Question

How does decreasing your credit card balance affect your income statement?(1 point)
Responses

It increases your monthly expenses, increasing the amount you spend each month.
It increases your monthly expenses, increasing the amount you spend each month.

It increases your monthly expenses, giving you more money to spend on other things.
It increases your monthly expenses, giving you more money to spend on other things.

It decreases your monthly expenses, increasing the amount you spend each month.
It decreases your monthly expenses, increasing the amount you spend each month.

It decreases your monthly expenses, giving you more money to spend on other things.

Answer 1

It decreases your monthly expenses, giving you more money to spend on other things.

Paying down the balance reduces future interest charges (an expense on the income statement); principal repayments themselves aren’t an expense.