Which of the following are examples of financial contracts?

• A. Mortgage, car loan, student loan
• B. Cell phone, subscription fees, membership fees
• C. Utilities
• D. Rent

Answer: (D)

A financial contract is a binding agreement that creates a monetary obligation or right between parties. Rent fits this idea because it’s a legally enforceable lease in which the tenant agrees to pay a defined amount for the use of property over a set period. The terms spell out how much is paid, when it’s due, and what happens if payments aren’t made, tying money to the ongoing use of a resource. While other items involve money or services, rent is a straightforward example of a contractual financial arrangement that centers on paying for the right to use property.