Loans
Borrowing arrangement; money provided to be repaid with interest.
Formula
Total Loan Repayment = Principal + (Principal × Interest Rate × Time)
Real World
When Brewdog expanded its brewery in Ellon, Scotland, it secured a long-term bank loan secured against property assets — enabling capital investment while spreading repayment over years to protect cash flow.
Exam Focus
Always state whether the loan is secured or unsecured and link this to business risk level — unsupported answers cap at low marks.
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