When she uses her American Express card, Cathy obtains possession of goods or services when they are purchased.Payment is due when billed at a later date.American Express is a type of:
A)instalment account.
B)open charge account.
C)revolving account.
D)selective account.

Question

Quizplus · Accepted Answer

Cathy obtains possession of goods or services when she uses her American Express card, and payment is due when billed at a later date. This is the definition of an open charge account, where there is typically no pre-set spending limit and the balance must be paid in full each month. It is not an instalment account, where payments are made over a set period of time, or a revolving account, where a balance can be carried forward and interest is charged on that balance. A selective account is not a type of credit account.

When She Uses Her American Express Card, Cathy Obtains Possession