A Letter from a Collection Agency to a Consumer That

question 1

True/False

A letter from a collection agency to a consumer that gives the impression a lawsuit is about to be brought against the consumer when in fact it will not be brought is not a violation of the Fair Debt Collection Practices Act.

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Definitions:

Coupon

A financial term referring to the annual interest payment received by a bondholder from the bond's issuer until it matures.

Weighted Average Cost

An inventory valuation method which assumes goods are used in the order in which they were purchased, often leading to a cost that is somewhere between the oldest and newest products.

Marginal Tax Rate

The tax rate that applies to each additional dollar of income earned; the percentage of tax paid on any additional income earned.

Capital Structure

The mix of a company's long-term debt, specific short-term debt, common equity, and preferred equity, which determines its financial leverage.