Louise Got Caught in a Cash Flow Trap and Desperately

question 11

Multiple Choice

Louise got caught in a cash flow trap and desperately needed money quickly. Unfortunately, she didn't shop around and she went to a _____. As a result, her annual percentage rate was higher than 780%!

• A) commercial bank
• B) check-cashing outlet
• C) pawnshop
• D) payday loan company
• E) rent-to-own center

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Definitions:

Economic Theories

Conceptual frameworks explaining how economies function and the relationships between different economic agents and factors.

Economic Policy

Strategies and decisions by a government or organization aimed at achieving specific economic aims, such as controlling inflation, reducing unemployment, or promoting growth.

Capital Goods

Assets used by businesses to produce goods and services, such as machinery, buildings, and equipment.

Investment

Expenditures that increase the volume of physical capital (roads, factories, wireless networks) and intangible ideas (formulas, processes, algorithms) that help to produce goods and services. Also known as economic investment. Not to be confused with financial investment.