Which Statement Is an Example of Collateral

question 165

Multiple Choice

Which statement is an example of collateral?

• A) A firm must pay a higher coupon rate on bonds at their issuance due to risk.
• B) Venture capitalists receive partial ownership of a firm.
• C) Private equity funders demand partial ownership.
• D) A bank has the right to take ownership of a factory building if the borrower defaults on the mortgage loan.

---

Definitions:

Population Standard Deviation

A measure of the dispersion of all values in the entire population from the mean of the population.

Confidence Interval

A range of values that is believed to contain an unknown population parameter, calculated from a given set of sample data.

Sample Variance

A statistical measure of the dispersion of observations in a sample dataset around the sample mean.

T Distribution

A family of probability distributions that can be used to develop an interval estimate of a population mean whenever the population standard deviation s is unknown and is estimated by the sample standard deviation s.