What is installment buying?

What is installment buying?

• A. Paying for products in full at the time of purchase
• B. Buying products on credit without a payment plan
• C. Purchasing items through small, regular payments over time
• D. Leasing products without any ownership

Answer: (C)

Installment buying is best defined as purchasing items through small, regular payments over time. This practice became particularly popular in the early 20th century, allowing consumers to buy goods and pay for them in manageable sums rather than requiring the full amount upfront. This method of purchasing was significant during the 1920s and later periods as it enabled a broader range of people to acquire products, especially expensive items like automobiles and household appliances, encouraging consumer spending and contributing to economic growth. It effectively allowed consumers to spread the financial burden and make larger purchases more accessible. The other options do not accurately describe installment buying. Paying for products in full at the time of purchase refers to a different purchasing strategy called cash or full payment. Buying products on credit without a payment plan suggests a more flexible or undefined repayment term, which is distinct from the structured approach of installment buying. Leasing products without any ownership involves renting a product rather than purchasing it, which clearly does not align with the concept of installment buying, where ownership of the item is the goal.

Installment buying is best defined as purchasing items through small, regular payments over time. This practice became particularly popular in the early 20th century, allowing consumers to buy goods and pay for them in manageable sums rather than requiring the full amount upfront.

This method of purchasing was significant during the 1920s and later periods as it enabled a broader range of people to acquire products, especially expensive items like automobiles and household appliances, encouraging consumer spending and contributing to economic growth. It effectively allowed consumers to spread the financial burden and make larger purchases more accessible.

The other options do not accurately describe installment buying. Paying for products in full at the time of purchase refers to a different purchasing strategy called cash or full payment. Buying products on credit without a payment plan suggests a more flexible or undefined repayment term, which is distinct from the structured approach of installment buying. Leasing products without any ownership involves renting a product rather than purchasing it, which clearly does not align with the concept of installment buying, where ownership of the item is the goal.