
To Discuss: The importance of Commercial Banks, Savings, Loan Associations, Saving Bank, Credit Union, Finance Company, Charge Account, Credit Card, Finance Charge and Annual Percentage Rate (APR).

Explanation of Solution
Economies activities in the field of consumptions, production, distribution and other branches of economies cannot be carried on properly without banks. Commercial bank is the heart and central point of modern exchange economy.
Savings help in become financially secure and stable and provide future safety. Savings help in retirement, emergency cushion and in education.
The main and foremost importance of loan association is to make mortgage loans available on residential property.
Credit union is more likely to have rules in place that are more forgiving while overdrawing the check account or having a lower credit score. Credit union offer higher saving rates and lower interest rates on loans.
For efficient carrying out various activities, business requires finance which refers as business finance. Hence finance is called the lifeblood of any business and business would get stranded unless there are sufficient funds available for utilization.
In order to keep track of trade credit a company completes a charge account application. With this a company can charge purchases which are trade credit.
Credit cards play an important role in the cycle of increased consumption and production by offering merchants a guaranteed method of payment and providing consumers with a way to bridge the gap between paychecks in times of emergency.
Finance charges are calculated each billing cycle based upon the current prime rate. Finance charges usually come with any form of credit, whether it’s a credit card, business loan or a mortgage. Any amount that paid beyond the amount borrowed is a finance charge.
A good annual percentage rate may be different depending on the type of credit you are applying. Therefore the average APR offered on credit cards is generally higher than the average APR.
Introduction:
Commercial Banks comprising of public sector banks, foreign banks and private sector banks, represent the most important financial intermediary in the Indian financial system.
Saving is a process of setting aside a portion of current income for future use, or the flow of resources accumulated over a period of time. Saving may take the form of increases in bank deposits, purchase of securities or increased cash holdings.
Loan Associationswere insured by the Federal Savings and Loan Insurance Corporation.Loan Associations is a financial institution similar to a bank that specializes in helping people to get residential mortgages.
Saving Bank is organized to hold funds of individual depositors’ interest-bearing accounts and to make long-term investments.
Credit Unionis a type of financial cooperative that provides traditional banking services. Credit unions can be formed by large cooperation, organization and other entities for their employees and members.
Finance Companyis a specialized financial institution that supplies credit for the purchase of consumer goods and services by purchasing time-sales contracts of merchants or by granting small loans directly to consumers.
Charge Account is a trade credit facility under which goods are delivered or services are provided to creditworthy customers, who agrees to pay for them a certain period after the date of invoice.
Credit Card refers to a convenient substitute for cash or check, and an essential component of electronic media or commerce media.
Finance Charge refers to the total cost of borrowing that include, interest rates, commitment fees and other charges paid by the borrower to avail the loan facility.
Annual Percentage Rate refers to standardized method of finding the effective interest rate on consumer loans, especially where interest is computed on monthly or other non-annual basis.
Chapter 4 Solutions
Economics Today and Tomorrow, Student Edition
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Horngren's Financial & Managerial Accounting, The Financial Chapters (Book & Access Card)
Engineering Economy (17th Edition)
Gitman: Principl Manageri Finance_15 (15th Edition) (What's New in Finance)
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Foundations Of Finance
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