When a Creditor Looks at the Borrower's Attitude Toward Credit

question 136

Multiple Choice

When a creditor looks at the borrower's attitude toward credit obligations, which of the 5 Cs of credit is she analyzing?

• A)Capacity
• B)Capital
• C)Character
• D)Collateral
• E)Conditions

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Definitions:

Government Spending

Expenditures made by the government of a country on collective needs and wants such as infrastructure, public safety, education, and healthcare.

Public Debt

Money that is owed by a government to creditors within the country or externally, arising from borrowing to finance expenditures exceeding tax revenues.

Budget Deficits

The amount by which government spending exceeds its revenue over a specified period, leading to a need for borrowing or currency printing.

Federal Budget Deficit

The shortfall when a government's total expenditures exceed its total revenue for a specific fiscal period, leading to borrowing or the depletion of reserves.