John Is a Factor Who Has Just Bought $40 000

question 87

Multiple Choice

John is a factor who has just bought $40 000 worth of finished goods for $24 000. The profit that he will make on this transaction depends on

• A) the quality of the receivables, the cost of collecting them, and interest rates.
• B) the cash he has available, and the trade credit he is able to get.
• C) the availability of government loans, the quality of the receivables, and the interest rate.
• D) the interest rate, the cost of collecting the receivables, and the maturity date of bonds of his company.
• E) the general state of the economy, the number of firms who might be interested in the receivables, and the amount of money those firms have available.

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Definitions:

Information

Data that has been processed, organized, or structured in a way that is meaningful and useful to the receiver.

Informal Conversation

Casual exchange of thoughts and information between individuals, without adherence to strict rules of dialogue.

Systematic Process

A methodical procedure followed in a fixed sequence of steps to achieve a specific result or outcome.

Boolean Logic

A form of algebra in which all values are reduced to either TRUE or FALSE, widely applied in computer science, search engine operations, and mathematical reasoning.