Which of the Following Is True About the Distinction Between

question 32

Multiple Choice

Which of the following is true about the distinction between secured and unsecured credit?

• A) Secured debt is debt that has already been paid, while unsecured debt has not yet been paid.
• B) Unsecured debt is expected to be collected, whereas collection of secured debt is doubtful.
• C) Secured debt will be collected over a time period of more than one year, while unsecured debt is expected to be collected within one year.
• D) Secured debt has collateral associated with it, while unsecured debt has no associated collateral.
• E) Secured debt results from a court judgment, whereas unsecured debt results from an agreement between the parties.

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Definitions:

Coinsurance Coverage

A type of insurance in which the insured pays a share of the payment made against a claim.

Coinsurance Clause

A provision in insurance policies requiring policyholders to insure their property to a specified percentage of its value to receive full reimbursement for a loss.

Insurance Company

A business that provides coverage, in the form of compensation resulting from loss, damages, injury, treatment, or hardship in exchange for premium payments.

Coinsurance Clause

A provision in insurance policies that requires the policyholder to bear a share of the loss to some specified extent.