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Banking and Money (Khan Academy)

A Loan That Looks Like a Sale

Leave your watch at a pawn shop and you get a loan. Sell it with a promise to buy it back, and you have made a repo.

16 min145 XP available5 challenges

Pick the best answer

A repo works almost exactly like a loan backed by collateral (something valuable the lender can keep if you do not pay). What is the real difference?

Answer to continue.