Introduction to Business and Marketing. OBJECTIVES Identify the sources of credit Understand the...
-
Upload
emmeline-austin -
Category
Documents
-
view
228 -
download
0
Transcript of Introduction to Business and Marketing. OBJECTIVES Identify the sources of credit Understand the...
![Page 1: Introduction to Business and Marketing. OBJECTIVES Identify the sources of credit Understand the types of credit.](https://reader035.fdocuments.in/reader035/viewer/2022062300/56649d985503460f94a83131/html5/thumbnails/1.jpg)
TYPES OF CREDITIntroduction to Business and Marketing
![Page 2: Introduction to Business and Marketing. OBJECTIVES Identify the sources of credit Understand the types of credit.](https://reader035.fdocuments.in/reader035/viewer/2022062300/56649d985503460f94a83131/html5/thumbnails/2.jpg)
OBJECTIVES
Identify the sources of credit
Understand the types of credit
![Page 3: Introduction to Business and Marketing. OBJECTIVES Identify the sources of credit Understand the types of credit.](https://reader035.fdocuments.in/reader035/viewer/2022062300/56649d985503460f94a83131/html5/thumbnails/3.jpg)
THE MAIN IDEA There are many different types of credit plans
including
charge accounts
credit cards
single payment loans
installment loans
mortgage loans
![Page 4: Introduction to Business and Marketing. OBJECTIVES Identify the sources of credit Understand the types of credit.](https://reader035.fdocuments.in/reader035/viewer/2022062300/56649d985503460f94a83131/html5/thumbnails/4.jpg)
Length of Loans
• One year or lessShort-term Loan
• 1-5 yearsMedium-term Loan
• More than 5 yearsLong-term Loan
![Page 5: Introduction to Business and Marketing. OBJECTIVES Identify the sources of credit Understand the types of credit.](https://reader035.fdocuments.in/reader035/viewer/2022062300/56649d985503460f94a83131/html5/thumbnails/5.jpg)
Sources of Credit
Charge Accounts
Credit Cards
Banks and other
Financial Institutions
Seller Provided
Credit
Consumer Finance
Companies
![Page 6: Introduction to Business and Marketing. OBJECTIVES Identify the sources of credit Understand the types of credit.](https://reader035.fdocuments.in/reader035/viewer/2022062300/56649d985503460f94a83131/html5/thumbnails/6.jpg)
Charge Accounts Credit provided by a store or
company for customers to
buy its products
Can usually only be used at
that store
![Page 7: Introduction to Business and Marketing. OBJECTIVES Identify the sources of credit Understand the types of credit.](https://reader035.fdocuments.in/reader035/viewer/2022062300/56649d985503460f94a83131/html5/thumbnails/7.jpg)
Credit Cards Credit cards are like charge
accounts, but some can be used in
many different places.
Some credit cards have annual
fees, which can range from $25-
80.
Credit card companies earn
money from the interest they
charge and annual fees
![Page 8: Introduction to Business and Marketing. OBJECTIVES Identify the sources of credit Understand the types of credit.](https://reader035.fdocuments.in/reader035/viewer/2022062300/56649d985503460f94a83131/html5/thumbnails/8.jpg)
Types of Credit Cards Single Purpose Cards - can be used to
buy goods or services only at the
business that issued the card
Multipurpose Cards - also called bank
credit cards because banks issue them
Can be used at many different businesses
Travel and Entertainment Cards –
holders must pay the full amount due
each month and pay an annual fee
![Page 9: Introduction to Business and Marketing. OBJECTIVES Identify the sources of credit Understand the types of credit.](https://reader035.fdocuments.in/reader035/viewer/2022062300/56649d985503460f94a83131/html5/thumbnails/9.jpg)
Banks and Other Financial Institutions
Want to lend money to
people with good credit
ratings
Credit unions only lend
money to credit union
members and employees
![Page 10: Introduction to Business and Marketing. OBJECTIVES Identify the sources of credit Understand the types of credit.](https://reader035.fdocuments.in/reader035/viewer/2022062300/56649d985503460f94a83131/html5/thumbnails/10.jpg)
Single-Payment Loan A debtor pays back a single-
payment loan in one payment,
including interest
Many farmers secure single-
payment loans in the spring
and pay back in fall
![Page 11: Introduction to Business and Marketing. OBJECTIVES Identify the sources of credit Understand the types of credit.](https://reader035.fdocuments.in/reader035/viewer/2022062300/56649d985503460f94a83131/html5/thumbnails/11.jpg)
Installment Loan Loans repaid in regular payments
over a period of time
Examples
Student loans
Car loans
Home improvement loans
![Page 12: Introduction to Business and Marketing. OBJECTIVES Identify the sources of credit Understand the types of credit.](https://reader035.fdocuments.in/reader035/viewer/2022062300/56649d985503460f94a83131/html5/thumbnails/12.jpg)
Mortgage Loan
Installment loan that lasts a long time
Usually 15-30 years
Used to purchase real estate (home)
Home serves as collateral
![Page 13: Introduction to Business and Marketing. OBJECTIVES Identify the sources of credit Understand the types of credit.](https://reader035.fdocuments.in/reader035/viewer/2022062300/56649d985503460f94a83131/html5/thumbnails/13.jpg)
Seller-Provided Credit
Many stores provide credit for their
customers
Clothing, furniture, and appliance stores as
well as car dealerships are among those
that offer credit to customers.
![Page 14: Introduction to Business and Marketing. OBJECTIVES Identify the sources of credit Understand the types of credit.](https://reader035.fdocuments.in/reader035/viewer/2022062300/56649d985503460f94a83131/html5/thumbnails/14.jpg)
Consumer Finance Companies
Specialize in loans to people who might
not be able to get credit elsewhere
These loans are more expensive
because the risk for the lender is high
![Page 15: Introduction to Business and Marketing. OBJECTIVES Identify the sources of credit Understand the types of credit.](https://reader035.fdocuments.in/reader035/viewer/2022062300/56649d985503460f94a83131/html5/thumbnails/15.jpg)
Other Types of Loans
Payday advance
services offer short-
term loans until
payday
Payday advance
services charge high
fees and interest
![Page 16: Introduction to Business and Marketing. OBJECTIVES Identify the sources of credit Understand the types of credit.](https://reader035.fdocuments.in/reader035/viewer/2022062300/56649d985503460f94a83131/html5/thumbnails/16.jpg)
Other Types of Loans
A pawnshop loan is based on the value
of something you own that is left with a
pawnbroker as security against money
borrowed
Items can be bought back later
![Page 17: Introduction to Business and Marketing. OBJECTIVES Identify the sources of credit Understand the types of credit.](https://reader035.fdocuments.in/reader035/viewer/2022062300/56649d985503460f94a83131/html5/thumbnails/17.jpg)
Think about it!
Think about the following questions and
discuss them with your pod.
Formulate an answer and be prepared to
share your answer with the class.
![Page 18: Introduction to Business and Marketing. OBJECTIVES Identify the sources of credit Understand the types of credit.](https://reader035.fdocuments.in/reader035/viewer/2022062300/56649d985503460f94a83131/html5/thumbnails/18.jpg)
Question 1
Do you think people who are responsible
and pay all their debts on time should
have the same interest rate as people
who are delinquent on payments?
Why or why not
![Page 19: Introduction to Business and Marketing. OBJECTIVES Identify the sources of credit Understand the types of credit.](https://reader035.fdocuments.in/reader035/viewer/2022062300/56649d985503460f94a83131/html5/thumbnails/19.jpg)
Question 2
Do you think it is fair for payday loans
and car title loans to have higher
interest rates than regular bank loans?
Why or why not
![Page 20: Introduction to Business and Marketing. OBJECTIVES Identify the sources of credit Understand the types of credit.](https://reader035.fdocuments.in/reader035/viewer/2022062300/56649d985503460f94a83131/html5/thumbnails/20.jpg)
Activity
Complete the chapter 25 Review and
Activities
Review Key Concepts 1-5
Critical Thinking 6-13
Be prepared to share answers with the class