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In Order for an MFI to Be Profitable the Interest

question 20

Multiple Choice

In order for an MFI to be profitable the interest rate charged for poorer borrowers tends to be ________,so most of the loans are going to the _______ of potential borrowers.


Definitions:

Absorption Costing

An accounting method that includes both variable and fixed manufacturing costs in the cost of a product.

Net Operating Income

The profit realized from a business's operations after subtracting operating expenses but before deducting taxes and interest.

Variable Costing

A cost accounting method that includes only variable production costs (direct materials, direct labor, and variable manufacturing overhead) in product costs and treats fixed manufacturing overhead as a period expense.

Net Operating Income

The profit a company makes after deducting operating expenses but before interest and taxes from its total revenue.

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