Cash advance stores offer to lend money to an individual who,after a brief credit check,gives the store a post dated check for a certain amount and they receive a lesser amount.For example,the customer,who has no other options for loans given his or her poor credit,writes a check dated two weeks from today for $100 and the store remits to him $80,an annualized rate of interest of about 650%.Some states have outlawed cash advance stores as described here.Using what you've learned in this chapter,and assuming the rate of default on these loans is 20%,defend this practice.

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The Answer of Cash advance stores offer to lend money to an individual who,after a brief credit check,gives the store a post dated check for a certain amount and they receive a lesser amount.For example,the customer,who has no other options for loans given his or her poor credit,writes a check dated two weeks from today for $100 and the store remits to him $80,an annualized rate of interest of about 650%.Some states have outlawed cash advance stores as described here.Using what you've learned in this chapter,and assuming the rate of default on these loans is 20%,defend this practice.

Cash Advance Stores Offer to Lend Money to an Individual