A Customer Has Ordered Goods Generating a Present Value of $1,200

question 58

Multiple Choice

A customer has ordered goods generating a present value of $1,200. The present value of production costs is $800. Under what conditions should you extend credit if there is no possibility of repeat orders?

• A)If the probability of payment exceeds 0.67
• B)If the probability of payment exceeds 0.75
• C)If the probability of payment exceeds 0.80
• D)If the probability of payment exceeds 0.90

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Definitions:

Fads and Fashion

Transient popularities or trends in styles, behaviors, or interests that capture the public’s attention temporarily.

Demographic Transition

A model that describes the economic and social changes that lead to declining birth and death rates in a society.

Population Patterns

The distribution, composition, and change over time of people in a given area, often analyzed for demographic insights.

Degree of Development

A measure of a country's economic, social, and technological progress.