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Trade Credit

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Meta Hirthe

Lvl 10
3y ago

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Why is trade credit generally the largest source of short term credit for small firms?

Well, trade credit would be credit extended by suppliers (I guess). So, if in fact it is the largest source of short term credit, it would be because it is easier to get credit from people that want to sell you something than from someone that lends money (the potential profit warrants the risk).


Where can one get car insurance if one has bad credit?

Bad credit will generally mean that car insurance cannot be purchased on a monthly pament plan. Although some firms will give this option they will charge higher fees. Most firms will still sell you insurance.


What is the importance of credit in your economy?

Credit enables the individuals and firms to purchase the important inputs for the production. Generally one businessman has not sufficient amount for the business. So credit is very useful for the business.


Why is small business firms could not easily source funds?

why small business firms could not easily source for needed funds


Discuss the relative use of credit between large and small firms Which group is generally in the net creditor position and why?

Larger firms tend to be in a net creditor position because they have the financial resources to be suppliers to credit. The smaller firm must look to the larger manufacturer or wholesaler to help carry the firm's financing requirements.


How can one check their credit rating from home?

There are a number of firms in the UK that allow you to check your credit rating from home. Firms such as Experian, Checkmyfile and Equifax offer online services that show your credit report. As at May 2013, many of these firms offer a free 30 day trial of their services.


A primary reason firms sell on credit is?

A primary reason firms sell on credit is to maintain their clients and also to move their stocks. These is one of the strategies of releasing revenue by an organization.


What is the largest investment for many firms?

legal advice


How do firms benefit from credit purchases?

They can charge extra money for the credit and encourage consumers to spend more.


What are the big four accounting firms?

The largest firms are commonly referred to as "The Big Four." These four firms are: Deloitte and Touche, Ernst and Young, KPMG, and PricewaterhouseCoopers.


What are the largest investment-banking firms?

JPMorgan, Goldman Sachs, Bank of America Merrill Lynch, Morgan Stanley, JM Financial, Citigroup, Barclays Investment Bank, Credit Suisse, Deutsche Bank


What are the reasons why firms give credit?

Firms give credit so people will spend what they normally wouldn't spend. This way the store or entity makes more money, not only on product but on interest rates on the credit card. Most people will buy more on credit than they will with cash on hand.