Trent is broke and needs cash immediately to pay off a debt he incurred. He visits the local pawn shop and leaves his grandfather's watch in exchange for $100.00 cash. This is an example of what type of loan?

Question

Quizplus · Accepted Answer

Trent's transaction is an example of a secured loan because he provided his grandfather's watch as collateral to receive the $100.00 cash. This means the loan is secured by the value of the watch.

Trent Is Broke and Needs Cash Immediately to Pay Off