Meeting the spending targets in this Budget meant some very difficult choices. â€"President Barack Obama, 2012 Budget Message of the President What does it mean to make "difficult choices" when creating a federal budget? deciding how to keep interest rates on the national debt low deciding which country to borrow from to finance spending deciding how much to lend and how much to tax deciding what will be funded and what will be cut.

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Secured loans are protected by collateral security. examples: title loans where the borrower uses the car title as collateral security interest rates are lower and repayments are longer therefore risk is low as a collateral security is given as guarantee to the bank in case of failure to pay the loanunsecured loans are not protected by collateral security but it is given on the creditworthiness of the borrower, trusting that she/he will pay on time. examples; payday loans is a short term loan where the borrower lends money from the bank and pays is back when the borrower receives his/her wages.interest rates are high and repayments are shorter. but the risk is high as no collateral security is given as a guarantee to the bank for payment of the loan