When a Creditor Sells a Consumer Good to a Debtor

question 81

True/False

When a creditor sells a consumer good to a debtor on a credit basis or a creditor extends a loan to a debtor for the purchase of a consumer goods,the security interest does not perfect automatically; instead,the secured party must file a financing statement in order for the security interest to perfect.

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Definitions:

Law of Diminishing Returns

An economic principle stating that if one factor of production is increased while other factors are held constant, the resulting increase in output will eventually decrease.

Fixed Input

Production factor that cannot be varied.

Technological Improvement

A process of innovation where new technologies or improvements to existing ones increase the efficiency or effectiveness of products, services, or processes.

Diminishing Returns

A principle stating that as investment in a particular area increases, the rate of profit from that investment, after a certain point, cannot increase proportionally.