Credit

May 14th, 2015

Warm Up

What is the difference between a fixed expense and a flexible expense?  Give 2 examples of each.








Learning Objective:  Students will understand how to be financially responsible.

Success Criteria: Students will be able to explain how to use credit carefully and responsibly.






Credit is money you borrow with a promise to pay it back with interest.

The amount you're allowed to borrow is based on three things:

1. Your capacity - ability to pay the money back
2. Your character - your reputation when it comes to paying things back
3. Your capital - what you can give them if you can't pay it back

People get into trouble when they borrow too much and don't pay it back.  Interest can pile up against you causing you to have to pay back far more than you borrowed in the first place.

However, there are some advantages to credit.

1. Helpful in times of emergency
2. It is more convenient and safer than carrying cash
3. Allows you to make major purchases like a house or car

Complete pages 10 & 11 of your packets using the booklet.

DO NOT WRITE ON THESE BOOKLETS!!!!!

DO NOT TAKE THESE BOOKLETS OR PACKETS WITH YOU!!!

Electronic copies of both can be found on the class blog under the packets section over there.