As an Experienced Financial Adviser You Are Often Asked to Provide

question 26

Essay

As an experienced financial adviser you are often asked to provide assistance to people who are contemplating taking out a new credit card or transferring their existing credit card facilities from one lender to another. Often the lender provides 'financial incentives' to the applicant to encourage them to undertake such borrowing arrangements including; credit limit increases, honeymoon rates and cash back offers. Outline what these 'financial incentives' provide to the potential applicant and the considerations that they should assess prior to undertaking any of these credit arrangements.

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Definitions:

Nonprofit Distributing

Organizations that do not distribute their surplus funds to owners or shareholders but instead use them to support their missions and activities.

Closed Competition

A competitive scenario where participation is restricted to specific entities or individuals who meet predetermined criteria.

Noncompulsory Distributions

Financial or resource allocations made by an organization or government that are not mandated by law or regulation, often discretionary in nature.

Demand Heterogeneity

Describes the variation in consumers' preferences and needs, which can influence the market strategy of businesses.