The Difference Between the Amortized Cost Basis of a Debt

question 115

Multiple Choice

The difference between the amortized cost basis of a debt security and the present value of expected cash flows for that security discounted at the effective interest rate implicit in the debt instrument when it was originally acquired is called the

• A)amount representing the credit loss.
• B)amount related to all other factors.
• C)other-than-temporary impairment.
• D)subsequent recovery in fair value.

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Definitions:

Res Ipsa Loquitur

A doctrine in tort law that allows the presumption of negligence by the defendant where the accident could not have happened without negligence and the instrument of injury was under the defendant's control.

Negligence

The failure to exercise the care that a reasonably prudent person would exercise in like circumstances, leading to unintended harm.

Proximate Cause

A legal concept that identifies the primary cause of damage or injury in a negligence lawsuit, determining the extent of a defendant's liability.

Gas Cans

Portable containers designed specifically for the storage and transport of gasoline or other flammable liquids.