Borrowing money from a bank drawing more money than is actually in a current account. Interest is charged on the amount overdrawn.
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Mortgage
A loan usually used to buy property, where property is used as security.
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Loan
Borrowing a sum of money which then has to be repaid with interest over a period of time, such as 1-5 years, typically in fixed monthly instalments.
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Government Grant
Money that the government will give to a business to set up in certain areas of the country, e.g. places with high unemployment, to encourage growth in the economy.
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Savings
Money that has been saved personally by the owner. It may be redundancy pay etc
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Trade Credit
Suppliers who allow debts for goods and services to be paid at a later date.
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Hire Purchase
A method of obtaining an asset in return fort a series of monthly payments. Ownership transfers once final payment has been made.
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Sale of Assets
Selling parts of the business in return for money.
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Venture Capital
Investment from a business that is established into another business in return for a percentage equity in the business.
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Limited Liability
An investor's liability/financial commitment is limited to the total amount invested or promised in share capital. An investor's personal belongings beyond this venture are protected.
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Unlimited liability
The owners of a business are responsible for the total amount of debt of the business. The owner may loose their personal belongings if the value of these is needed to cover the debts of the business.
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Other cards in this set
Card 2
Front
A loan usually used to buy property, where property is used as security.
Back
Mortgage
Card 3
Front
Borrowing a sum of money which then has to be repaid with interest over a period of time, such as 1-5 years, typically in fixed monthly instalments.
Back
Card 4
Front
Money that the government will give to a business to set up in certain areas of the country, e.g. places with high unemployment, to encourage growth in the economy.
Back
Card 5
Front
Money that has been saved personally by the owner. It may be redundancy pay etc
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