Which of the Following Is True of a Guarantor in a Guaranty

question 50

Multiple Choice

Which of the following is true of a guarantor in a guaranty arrangement?

• A) The guarantor is primarily liable to the principal debtor's debt when it is due.
• B) The guarantor can be approached even if the principal debtor is not in default.
• C) The creditor can seek first remedy from a guarantor.
• D) The guarantor has full legal rights to possession of the real property in this type of arrangement.

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Definitions:

Economic Profit

The gap between the total income a company makes and all of its expenses, covering both direct and indirect costs.

Optimal Output

The level of production that maximizes a firm's profits, where marginal revenue equals marginal cost.

Economic Profit

The contrast between a corporation's entire earnings and its full expenses, including both tangible and intangible costs.

Average Variable Cost

entails the calculation of the unit cost for variable expenses associated with production, adjusted for changes in output levels, providing insight into economies of scale.