On the Fair, Isaac and Company (FICO) Scale, Donald Falls

question 73

Multiple Choice

On the Fair, Isaac and Company (FICO) scale, Donald falls in the poor to below average category of creditworthiness. Based on the FICO scale, Donald is most likely to have a credit score between:

• A) 400 and 499.
• B) 500 and 599.
• C) 600 and 699.
• D) 700 and 799.

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Definitions:

Negative Expected Value

A statistical condition where the anticipated result of an investment is less than the initial cost.

Moral Hazard

The risk that one party to a transaction has not entered into the contract in good faith or has an incentive to take unusual risks because the costs are not borne by that party.

Flat Salary

A flat salary is a fixed amount of pay received by an employee, regardless of the number of hours worked or the quantity of output.

Car Dealership

A business that sells new or used cars at the retail level, typically based on a dealership contract with an automaker or its sales subsidiary.