Unit 1: Finance (2)

  • Created by: jj_123
  • Created on: 04-05-15 10:01
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  • Unit 1: Finance
    • Help and Support
      • The Governemnt
      • Private Firms
      • Charities
    • Sources of Finance
      • Bank Loan
        • Provided by a bank that will be paid back over a set period.
        • Large amounts can be borrowed.
        • Interest has to be paid.
      • Loan from Friends and Family
        • Provided by friends or family where the interest rate and payment period is agreed with them.
        • Flexible about re payment and may not have to pay interest.
        • May not be able to afford very much.
      • Overdrafts
        • Allows a business to spend more money than it has in the bank.
        • Can be used as many times without asking for permission.
        • High interest rates and can be asked to repay at anytime.
      • Mortgage
        • Long term loan for purchasing a building.
        • Repayments every month.
        • Variable interest rates which can be expensive.
      • Trade Credit
        • Suppliers allowed to be paid one or two month after delivery.
        • Free finance is available for the period of trade credit.
        • Discount for immediate or quick payment may be lost.
      • Grant
        • Money given to a business by a government organisation or charity.
        • The money does not have to be paid back.
        • Many business do not qualify for them.


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