BTEC Business Level 3 - Unit 3 -
Finance comprehensive Questions and
Answers with Verified Solutions
Question 1:
what are the 6 types of personal borrowing?
Answer:
mortgages, hire purchase, payday loans, overdraft, personal loans, credit
cards
Question 2:
personal loan
Answer:
gives you the ability to borrow a set amount of money, normally for a
specific purpose, to be repaid in regular instalments.
Question 3:
payday loan
Answer:
short term source of finance used to bridge the gaps between now and
next receiving a wage
Question 4:
credit card
Answer:
goods are paid for by card and can be paid for either at the end of a set
period, normally a month, when a statement is issued
,Question 5:
overdraft
Answer:
allows you to withdraw money that you don't have in a current account
Question 6:
mortgage
Answer:
long-term loan to fund the purchase of assets, normally paid back over a
long time, usually 25 years. it is secured against an item like a house.
Question 7:
hire purchase
Answer:
allows you to have use of an item immediately but pay for it in regular
instalments. the item remains the property of the seller until all
instalments have been made
Question 8:
what are the 6 saving and investment options?
Answer:
ISA, deposits & savings account, premium bonds, bonds & gilts, shares,
pensions
Question 9:
when are saving and investment options available?
Answer:
when you are earning or receiving more money than you need to cover
your expenditure
, Question 10:
Individual savings account (ISA)
Answer:
a type of saving account where the holder is not charged income tax on
the interest received.
Question 11:
deposit and savings account
Answer:
accounts where interest is paid on the balance and normally the holder
needs to give notice before withdrawing funds
Question 12:
premium bonds
Answer:
government scheme that allows individuals to save up to a set amount by
buying bonds. the bond holder doesn't receive interest on their savings
but each bond is placed into a regular draw for cash prizes
Question 13:
bonds & gilts
Answer:
fixed term securities where the lender lends money to companies and
governments in return for interest payments. the money is invested for a
specific period of time
Finance comprehensive Questions and
Answers with Verified Solutions
Question 1:
what are the 6 types of personal borrowing?
Answer:
mortgages, hire purchase, payday loans, overdraft, personal loans, credit
cards
Question 2:
personal loan
Answer:
gives you the ability to borrow a set amount of money, normally for a
specific purpose, to be repaid in regular instalments.
Question 3:
payday loan
Answer:
short term source of finance used to bridge the gaps between now and
next receiving a wage
Question 4:
credit card
Answer:
goods are paid for by card and can be paid for either at the end of a set
period, normally a month, when a statement is issued
,Question 5:
overdraft
Answer:
allows you to withdraw money that you don't have in a current account
Question 6:
mortgage
Answer:
long-term loan to fund the purchase of assets, normally paid back over a
long time, usually 25 years. it is secured against an item like a house.
Question 7:
hire purchase
Answer:
allows you to have use of an item immediately but pay for it in regular
instalments. the item remains the property of the seller until all
instalments have been made
Question 8:
what are the 6 saving and investment options?
Answer:
ISA, deposits & savings account, premium bonds, bonds & gilts, shares,
pensions
Question 9:
when are saving and investment options available?
Answer:
when you are earning or receiving more money than you need to cover
your expenditure
, Question 10:
Individual savings account (ISA)
Answer:
a type of saving account where the holder is not charged income tax on
the interest received.
Question 11:
deposit and savings account
Answer:
accounts where interest is paid on the balance and normally the holder
needs to give notice before withdrawing funds
Question 12:
premium bonds
Answer:
government scheme that allows individuals to save up to a set amount by
buying bonds. the bond holder doesn't receive interest on their savings
but each bond is placed into a regular draw for cash prizes
Question 13:
bonds & gilts
Answer:
fixed term securities where the lender lends money to companies and
governments in return for interest payments. the money is invested for a
specific period of time
