Definition

Having a set amount of money available to borrow as needed. It offers flexibility when unexpected expenses come up.

What to consider

  • Compare different financing options.
  • Watch for changes in interest rates.
  • Include interest in total cost calculations.

Real world scenarios

  • A manufacturing firm reviews its monthly interest expenses on outstanding loans.
  • An entrepreneur factors interest costs into the overall cost of debt.
  • A small business monitors interest expense trends to optimize financing.

Related terms

Entrepreneurial Finances