The 5 Cs of Credit Include All of the Following

question 38

Multiple Choice

The 5 Cs of Credit include all of the following except

• A) cash.
• B) capital .
• C) character.
• D) collateral.
• E) capacity.

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Definitions:

Capital

Financial assets or the financial value of assets, such as cash and securities, used to fund a business or generate wealth.

Diminishing Marginal Returns

The principle that as additional units of a factor of production are added to a fixed amount of other factors, the increase in output will eventually decrease.

Quantity of Capital

The total volume of physical assets, such as machinery and buildings, used in the production of goods and services.

Output Per Worker

The quantity of goods or services produced divided by the number of workers, indicating the productivity level of labor within an economy.