The Cost And/or Benefit That Occurs Beyond the Direct Exchange

question 11

Multiple Choice

The cost and/or benefit that occurs beyond the direct exchange between an organizations and its stakeholders is a(n) :

• A)Externality.
• B)Negative externality.
• C)Positive externality.
• D)Cost/benefit analysis.

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Definitions:

Debenture Bonds

Unsecured bonds that rely on the creditworthiness and reputation of the issuer rather than collateral.

Secured Bonds

Bonds that are backed by specific assets of the issuer as collateral, giving bondholders a claim to those assets if the issuer defaults.

General Credit

An overarching term that may refer to the creditworthiness of an individual or entity, or sometimes used to describe general lines of credit available for borrowing.

Corporation

A legal entity that is separate and distinct from its owners, who are shareholders, providing limited liability protection among other benefits.