The maximum amount of credit you are allowed by a creditor is called ________ credit.

Question

Quizplus · Accepted Answer

The maximum amount of credit you are allowed by a creditor is called a line of credit. A line of credit is a preset amount that you can draw upon as needed. It can be used for various purposes like home repairs, vacations, and emergencies. Unlike an installment loan, where you receive the full amount upfront, the line of credit allows you to use only what you need, when you need it, and you only pay interest on the amount you have borrowed.

The Maximum Amount of Credit You Are Allowed by a Creditor