To Avoid the Situation Where a Localized Economic Downturn Eliminates

question 12

Multiple Choice

To avoid the situation where a localized economic downturn eliminates the income of the company, which type of diversification should a company practice?

• A) Asset
• B) Conglomerate
• C) Revenue
• D) Geographic
• E) Investment capital

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Definitions:

Maturity Value

The amount that will be received at the maturity date of a financial instrument, typically including the principal and the interest.

Note Receivable

A financial asset representing a written promise to receive a specific amount of money, plus interest, from another party at a future date.

Interest Due

The amount of interest that has accumulated on borrowed funds or investments that is payable to the lender or investor.

Dishonoured Note

A promissory note that has not been paid by the maker or acceptor when due, leading to a default.