Which of the Following Is Least Likely to Be Correct

question 18

Multiple Choice

Which of the following is least likely to be correct about the factoring of receivables?

• A)the selling firm bears the risk of default
• B)the higher the perceived quality of the receivables, the lower the discount rate
• C)the discount is paid by the selling firm in the form of reduced sales price
• D)factoring may be the cheapest method of avoiding a cash flow problem

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Definitions:

Birthrate

The number of live births per thousand of the population per year.

Diapers

Absorbent items worn by infants and young children to contain their waste until they are potty trained.

Drought

A prolonged period of abnormally low rainfall, leading to a shortage of water.

Peanut Crop

the cultivation and production of peanuts, a leguminous plant valued for its edible seeds.