Which of the Following Would Not Be a Characteristic of a Financial

question 6

Multiple Choice

Which of the following would not be a characteristic of a financial lease?

• A) They are usually fully amortized.
• B) They usually require the lessor to maintain and insure the leased assets.
• C) They usually do not include a cancellation option.
• D) The lessee usually has the right to renew the lease at expiration.

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Definitions:

Pre-Merger Market

The financial and economic conditions affecting companies and their stock prices before they undergo a merger.

External Growth

Expansion of a business through acquiring or merging with other companies, as opposed to internal growth through increasing sales, product lines, or efficiencies.

Diversification

In finance, selecting a portfolio of different (diverse) investments to limit the overall risk borne by the investor.

Economies of Scale

Cost advantages that a business can achieve due to expansion and increased production volume, leading to lower per-unit costs.