A Summons for a Liquidated Debt Is Often Referred to as a Default

question 12

Multiple Choice

A summons for a liquidated debt is often referred to as a default summons.What will happen to a debtor who does not file a defence or respond to a default summons within the required time period?

• A)The debtor can be ordered to carry out a community service that is chosen by the creditor.
• B)The debtor can be ordered to pay the debt without a court hearing.
• C)The debtor is classified as 'at fault' and will be ordered to negotiate a settlement with the creditor within 28 days.
• D)The debtor can be fined or arrested for 'contempt of court'.

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Definitions:

Barriers to Entry

Obstacles that make it difficult for new competitors to enter a market, such as high startup costs, strict regulations, or established brand loyalty.

Economic Profits

The excess of total revenues over total costs, including both explicit costs and opportunity costs, indicating a return beyond the normal profit level.

Accounting Profits

The net earnings of a company as calculated by subtracting total expenses from total revenues, according to standard accounting practices.

Perfect Competitor

A theoretical market structure where many firms sell homogeneous products, entry and exit from the market are free, and all participants have perfect information.