Which option describes revolving debt?

Revolving debt is defined as a type of credit that allows borrowers to access funds up to a specified limit and to borrow against this limit repeatedly as they pay down the balance. This characteristic makes it distinct from other types of debt, such as installment loans, where a borrower receives a lump sum upfront and pays it off over a fixed term. With revolving debt, such as credit cards or home equity lines of credit, as the borrower pays off the debt, they can borrow again without needing to apply for a new loan, making it a flexible credit option.

The other options do not accurately reflect the nature of revolving debt. A loan with no specified limit may describe certain types of unsecured personal loans but lacks the revolving credit feature. A fixed-rate mortgage loan is a type of installment debt with a set payment schedule and a specified term, while student loans typically fall under installment debt as well, being disbursed as a specific amount that must be repaid over time with set payments. None of these alternatives capture the essence of revolving credit, which is characterized by its repeated borrowing capability within a credit limit.