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Trade Credit and Promissory Notes

Author: Jeff Carroll

Source: Image of long arrow, LCD monitor, images by Video Scribe, License held by Jeff Carroll; Image of contract, Public Domain, http://bit.ly/1o4lUug.

Video Transcript
Terms to Know
Prime Interest Rate

The interest rate banks charge to their best commercial customers.

Promissory Note

A signed legal agreement to pay a specific amount of money at a certain time or under certain circumstances.

Trade Credit

Credit which suppliers extend to their customers for a specific period of time, usually 30, 60 or 90 days.

Unsecured Financing

A loan of funds based solely on an agreement between two parties that one will pay the other; no physical items are offered as collateral on the loan.