Which statement correctly differentiates open-end credit from closed-end credit?

Which statement correctly differentiates open-end credit from closed-end credit?

• A. Open-end credit is always secured by collateral and closed-end credit is unsecured.
• B. Open-end credit allows repeated borrowing up to a limit, such as a credit card, while closed-end credit is a loan with a fixed term and amount.
• C. Open-end credit must be repaid in full each month, while closed-end credit can be revolved over time.
• D. Open-end credit uses collateral for all balances.

Answer: (B)