Question

1. In situations with high risks, credit might create further problems for the borrower.
Explain. please short answer ​

Answer 1

Answer:

This is true that in circumstances of huge risks, credit produces more problems for the borrower on account of the following reasons: 1. The borrower has to repay a fixed percentage on the capital obtained, whereas the interest on investment may or may not come due to the ambiguity of business and economic situation.