Question

During this time, many families had only one income, therefore began to rely on credit. The ability to purchase goods and pay for them later. However, many companies charged interest, a fee for borrowing the money. What do you think are the advantages and disadvantages of using credit to buy things?

PLS HURRYYYY!!!! pls also not this was in wwi

Answer 1

Buying on credit is the process of consumption by means of which consumers do not instantly pay cash for the good they acquire, but rather extend their payment into the future, being the bank or financial institution that grants the credit who pays the business , after which the consumer must pay said amount to the bank.

This system is based on trust, that is, on the fact that the bank considers that the consumer will respond efficiently with their debts to the institution. That is why there are different credit scores, according to which each person has a greater or lesser risk with respect to the credit that is eventually granted to them.

As an advantage, buying on credit allows access to goods or services through financing, which otherwise could not be possible given the high costs. However, as a disadvantage, buying on credit generates debts that often end up being, by accumulation, impossible for consumers to pay.