12: Making
edit Choices
Client 1
I am 17 years old and a high school senior. I have earned good grades in high school. I have
a few hours a week. With this schedule, I think that I can complete my college degree in four
been admitted to a good state university. I would like to go to college full-time and work only
years. I am planning to major in chemical engineering. My college advisor has told me that
I am planning to apply for aid and to use college loans to pay for my college tuition and books.
chemical engineering is a hard major. My parents have no money to support me in college.
I plan to live at home and work in the summer to earn spending money for use during the
school year. I will be borrowing about $ 50,000 in total.
a. What is the main advantage of getting credit in this case?
b. What is the main disadvantage of getting credit?
c. Is the loan being used to purchase a valuable asset?
d. Do you think the client is likely to be able to repay the loan?
Explain.
e. Do you recommend that this client apply for the loan?