Which of the Following Is True About Provisional Credits

question 62

Multiple Choice

Which of the following is true about provisional credits?

• A) Once credit has been given to a customer,it cannot be taken away.
• B) If the bank allows a customer to withdraw amounts that have been granted provisionally,the credits for those amounts cannot be reversed.
• C) A bank can reverse credits up until there has been final settlement of an item,and if the customer does not then have the funds in his account to cover the reversal of the credit,the bank can sue the customer for the difference.
• D) A bank can reverse credits up until there has been final settlement of an item,and if the customer does not then have the funds in his account to cover the reversal of the credit,the bank must bear the loss for the difference.

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Definitions:

Penetration Pricing

A market strategy where a product is introduced with a low price to attract customers and gain market share before eventually increasing the price.

Demand-oriented

Pricing strategy or manufacturing approach that is guided by the level of demand from consumers or market conditions.

Price Lining

Setting the price of a line of products at a number of different specific pricing points.

Target Pricing

Consists of (1) estimating the price that ultimate consumers would be willing to pay for a product, (2) working backward through markups taken by retailers and wholesalers to determine what price to charge wholesalers, and then (3) deliberately adjusting the composition and features of the product to achieve the target price to consumers.