Unit 4 Discussion: Are Credit Cards Money?

 

One of the factors of production is capital – money. People and companies use and manipulate money – generally to create more money or to use what money they have as efficiently as possible. People – investors and founders and owners – put money and capital into a business. A company uses this money to build its business model.

Companies and people need to know whether they are making a profit or a loss, how much they owe, how much they own. Just like a company, we need to know if we are using our money wisely and efficiently. We need to keep track of the money we spend and what we owe. We need to know how we are performing over time. We need to know our own personal assets, our liabilities, and how much equity we have and are building.

For example, many of us are using student loans to build our own business model. We’re investing in ourselves, in our future. Even though we have to repay these loans, this is a good investment.

Let’s consider how we use money and our own personal finances. Respond to the following points:

• Consider the definition of money. Are credit cards money? Why or why not?
• Explain how we might monitor and track credit card use.
• How do you suggest we manage credit card debt?
• Give your opinion about this statement: “You should charge only what you can pay off that month. You should never carry a balance on a credit card.”
• If you owned your business, would you allow your employees to use company credit cards? Why or why not?
• When you reply to your classmates, compare your opinions about credit card use with theirs.