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Credit, in its most basic sense, is the loaning of currency or money and then being repaid the amount borrowed (with or without interest). When interest is charged, it generally reflects in whole or part the opportunity cost. In other words, if person A can invest amount X and get a return on investment of X+Y ("principle" plus "interest"), then the amount of interest (the "rate") that might be charged by person A loaning person B the principle should be at least the opportunity cost.
In the real world, if you borrow some money from someone or some company, and you have to pay it back, you are being extended credit. Since currency and money have a time value (you generally pay less interest rate for longer loan periods), if a company extends you "terms", this means you have some number of days to pay the bill. This is a form of credit. Typical terms are Net 30 (pay within 30 days), 2-10, Net 30 (pay within 10 days and you can take 2% off, otherwise pay within 30 days), and so on.
Alan R. Weiss
NetPlanetNews Economics Editor
Wiki User
∙ 12y ago
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Nature and function of credit?
nature and function of credit
What does a diversity of friends is a credit to your flexible nature mean?
ur Gay
What are the characteristics of credit?
1. it is a bipartite contract 2. the contract is personal in nature 3. the contract has a pecuniary nature 4. there is the presence of trust and confidence 5. credit is risk 6. futurity 7. creation of legal obligation 8. the transfer of ownership or title
Can you get an unsecured loan with bad credit?
It is very difficult to get an unsecured loan with bad credit. This is because of the nature of the loan. When a person gets an unsecured loan, it means there is no collateral to back the loan up with.
If you debit an account is it decrease or increase?
increase By debiting an account means,specific amount will be deducted for credit to the account for whom it is intended, which is contra entry by nature.
Nature and function of credit?
nature and function of credit
Is a service revenue a credit or debit?
Service Revenue is credit in nature because it is an income.
How is the nature of owners equity accounts explained?
CREDIT
Who established Antarctica as a continent?
Some credit Mother Nature.
What does a diversity of friends is a credit to your flexible nature mean?
ur Gay
Why are criminal records not shown on credit reports?
There are several reasons, but the main one is credit reports are of a civil nature and have no connection with criminal activities.
What new credit card became available in the 1950s?
Major changes in the nature and types of credit cards occurred in the 1950s. Two types of credit cards emerged in that decade: the charge card and the bank credit card.
Are purchases account is increased by a credit and decreased by a debit?
Purchases account is personal account in nature so debit means increase and credit means decrease.
What are the characteristics of credit?
1. it is a bipartite contract 2. the contract is personal in nature 3. the contract has a pecuniary nature 4. there is the presence of trust and confidence 5. credit is risk 6. futurity 7. creation of legal obligation 8. the transfer of ownership or title
What does not describe the GPC?
used for travel and fuel
Is purchases a credit or debit?
Purchases are personal account nature and as a basic accounting rule debit what comes in and credit what goes out so purchases has debit balance as normal balance.
Where can you find a dating site that don't need credit card for or that don't wont you to upgrade to do anything?
A vast majority of adult sites require a credit card for signup as an age verification measure. One needs to be a legal adult in order to be an account holder of a credit card, which explains why credit card verification is a major part of signups for dating sites of an adult nature. As for those that don't require a credit card for upgrading, they are few and far between. Due to the nature of such sites I cannot list them.
