What does a higher credit score generally lead to?

A higher credit score generally leads to better loan terms and lower interest rates because it indicates to lenders that the borrower has a history of managing credit responsibly. Lenders view individuals or businesses with high credit scores as less risky, which often translates into more favorable borrowing conditions. This can include lower interest rates on loans, which can save money over time, as well as better terms such as higher loan amounts or longer repayment periods.

In contrast, the other options relate to different aspects of business and finance that do not directly connect with the implications of credit scores. Increased demand for products pertains to market dynamics rather than individual credit histories. More inventory purchases are influenced by sales forecasts and business growth strategies, not credit scores. Lastly, higher employee retention rates involve human resource management practices and workplace culture, which are separate from creditworthiness or financial management.