A Mechanism by Which a Short-Term Loan Is Made, Allowing

question 23

Multiple Choice

A mechanism by which a short-term loan is made, allowing a shopper to purchase goods or services today and pay for it at a later date, is known as a ______card.

• A)debit
• B)commodity
• C)credit
• D)fiat

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Definitions:

Efficient Allocation

The optimal distribution of resources and goods to maximize the net benefit or welfare within an economy.

Allocation Efficient

A distribution of resources in which it is impossible to make any one individual better off without making at least one individual worse off.

Mutually Beneficial

A situation or agreement that provides advantages to all parties involved, ensuring that each gains from the interaction.

Transaction Costs

Expenses incurred when buying or selling a good or service, which can include fees, taxes, and other charges beyond the price of the product itself.