Final answer:
The question pertains to the Business subject, specifically finance. It addresses credit card interest rates and potential investigations into banks that charge higher than legal interest rates. The student's question highlights the significance of regulation in the credit card market, vital for both consumer protection and economic stability.
Step-by-step explanation:
The subject of this question is finance within Business, as it relates to credit card interest rates and potential legal consequences for a bank overcharging interest. In terms of consumer behavior, credit cards are a common method for borrowing money, allowing cardholders to pay back the borrowed amount with additional interest. While most cards offer a grace period for interest-free repayment, carrying a balance typically involves an interest rate of around 12% to 18% annually.
In the scenario described in the student's question, the bank that issues Card X has charged more than the legal interest rate for five out of six months in 2012, making it susceptible to an investigation. Considering the significant impact of credit card debts on the economy—where in May 2021 Americans had about $807 billion outstanding—it's crucial for regulatory bodies to monitor and take action against unlawful practices. The significant use of credit cards, as reported in 2015 with nearly 200 million American cardholders, points to the importance of fair and legal interest rates in protecting consumers and maintaining financial stability.