Which Statement Is Correct

question 50

Multiple Choice

Which statement is correct?

• A)A transfer without recourse means that the purchaser can go back to the company for compensation of bad debts.
• B)A transfer without recourse means that the purchaser of the receivables takes the collection risk.
• C)A transfer without recourse means that the seller of the receivables takes the collection risk.
• D)A transfer with recourse means that the purchaser of the receivables takes the collection risk.

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Definitions:

Exponentially Distributed

Refers to a probability distribution used to model the time between events in a Poisson process, characterized by a constant mean rate.

Random Variable

A variable whose outcomes depend on the results of a random phenomenon, with each outcome having a probability associated with it.

Density Function

A mathematical function that describes the probability distribution of a continuous random variable, giving the likelihood of any value within a range.

Exponential Distribution

A type of continuous probability distribution that is often used to model the time between independent events that happen at a constant rate.