Use the Following to Answer Questions

question 118

Multiple Choice

Use the following to answer questions:
Scenario 9-2. Ryan has just graduated from college with a business degree. He has a wonderful idea for a new business called Ryan's Road Machines. He would like to sell a variety of all terrain vehicles (ATVs) for the personal use of his selected clientele. Outstanding customer service will be his competitive advantage as he provides individual service to each of his customers. He has just one small problem, no capital. He knows that he must meet the five Cs of credit when looking at external funding in order to prove his creditworthiness.
-In Reference 9-2 above, Ryan has never borrowed money before; however, he currently has a loan outstanding for his school expenses. Which of the five Cs is judged primarily on the applicant's past repayment patterns?

• A) Character
• B) Capital
• C) Collateral
• D) Conditions

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Definitions:

Cash Inflows

The total amount of money coming into a company from its operational, investing, and financial activities over a period.

Payback Period

The duration needed to recover the cost of an investment or project, typically expressed in years or months.

Annuity

An investment vehicle that delivers a steady series of payments to someone, often utilized to generate income for those who are retired.

Nonfinancial Factors

Aspects influencing decision-making that are not quantifiable in monetary terms, such as environmental impact or employee satisfaction.