Question

Explain what is meant by credit. What is the function of interest?

Answer 1

Answer:

Credit is loan and interest is % charge levied on the borrowed money

Explanation:

Credit is basically a form of loan. In current times, it also signifies an argument through which the supplier lends money to the borrower (individual /organization) and becomes stake holder in the organization or ask for share in profit.

Rate of interest is the % charge levied on sum of money borrowed by the borrower for certain period of time

Answer 2

Answer:

Credit is the ability to borrow money. For the borrower, it is the ability to get a product or service based on the promise to pay for it in the future. Interest is the fee paid for using someone else’s money and its function is to make lending money worthwhile for the lender.

Explanation:

That's the sample response.