Final answer:
The false statement about credit is that it is used by consumers and businesses but not by governments. Governments also use credit, typically by issuing bonds.
Step-by-step explanation:
To identify the false statement about credit from the options provided, we will review each one:
- Credit is a major economic force in the United States. - This is true, as credit plays a significant role in consumer spending and business investments.
- Credit involves creating a debt that must be repaid. - This statement is also true since using credit means borrowing money that one is obligated to return.
- Credit is used by consumers and businesses but not by governments. - This statement is false. Governments also use credit to fund operations, invest in infrastructure, and manage short-term cash flow needs, among other things, often through the issuance of bonds.
- Credit is used to obtain items when we do not have cash to pay for them. - This is true and explains one of the primary purposes of credit.
As such, the correct answer is that governments do indeed use credit, making option c) the false statement.