Title: Evaluate the various methods of financing a purchase.
Course: Economics and Personal Finance (19262-36) > Section: Demonstrating Knowledge of Credit and Loan Functions

Evaluating the various methods of financing a purchase (e.g., loan, installment plan, layaway, credit card) should include use of a decision-making model, as well as the following actions:

- Defining terms used to describe credit
- Examining the opportunity cost of credit
- Weighing risks involved in no-payment/no-interest financing
- Explaining the types of credit (open- and closed-end, service credit, flex pay, secured and unsecured loans)
- Describing sources of credit and the associated interest rates and fees (retail stores, banks and credit unions, finance companies, pawn shops, payday loans, title loans, private lenders)
- Determining the best type and source of credit for sample purchases
- Verifying the credibility of online lenders

Teacher Resource:

Bureau of Financial Institutions, Virginia State Corporation Commission (SCC) (https://www.scc.virginia.gov/pages/Bureau-of-Financial-Institutions)