A Banker Is Analyzing a Company Which Operates in the Petroleum

question 154

Multiple Choice

A banker is analyzing a company which operates in the petroleum industry.Which of the following might be a major consideration in determining whether the company should receive a loan?

• A) The petroleum industry suffers from political pressures concerning the selling price of its products.
• B) Inflation has been high for several years in a row.
• C) All companies in the petroleum industry use the same accounting principles.
• D) The company has a large amount of interest payments related to many outstanding loans.

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Definitions:

Emergent

Refers to processes or patterns that arise spontaneously or naturally within systems or organizations, not due to a specific plan.

Trait

A distinguishing quality or characteristic, typically one belonging to a person.

Process

A series of actions or steps taken to achieve a particular end.

Influence

The capacity to have an effect on the character, development, or behavior of someone or something.