Which of the Following Is NOT a Major Advantage of Direct

question 4

Multiple Choice

Which of the following is NOT a major advantage of direct finance?

• A) Direct finance reduces financial institution' fees.
• B) Direct finance allows borrowers to diversify sources of funds.
• C) Direct finance allows greater flexibility in funding types.
• D) Direct finance reduces search and transactions costs.

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Definitions:

Gross Profit Percentage

A financial metric that indicates the portion of revenue that exceeds the cost of goods sold, expressed as a percentage.

Non-Controlling Interest

The portion of equity interest in a subsidiary not attributable to the parent company, representing minority shareholders' claim on assets and earnings.

Intercompany Gain

Profit derived from transactions between subsidiaries or divisions of the same company.

Consolidated Income Statement

Consolidated Income Statement is a financial statement that aggregates the financial performance of a company and its subsidiaries, presenting the overall income, expenses, and net income.