CONSUMER REVOLVING CREDIT

- Someone famous. CONSUMER REVOLVING CREDIT.

Personal debt taken on to purchase goods and services..

The line of credit remains open and can be used up to the maximum limit repeatedly.

REVOLVING CREDIT AGREEMENT.

An agreement that permits an account holder to borrow money repeatedly up to a set dollar limit while repaying a portion of the current balance due in regular payment.

Example :. Let assume that a firm has been granted a revolving credit amounting RM100,000 at 14 percent annual interest and 0.50% of commitment fee. It only uses RM80,000 and RM20,000 left unused.

OVERDRAFT.

Lets you borrow money through your current account by taking out more money than you have in the account.

COMMERCIAL PAPER.

A common form of unsecured, short-term debt issued by a corporation..

Example : Assume that the firm plans to issue RM100,000 commercial paper that can be sold at 94% of its face value. If maturity is 6 months and the issuing cost is 5%,.