Credit Scoring Models Are Used by Lenders to Determine

question 17

Multiple Choice

Credit scoring models are used by lenders to determine:

• A)the best discount to offer each customer.
• B)the appropriate price to charge each customer.
• C)the optimal debt-equity ratio for the firm.
• D)a borrower's credit risk.
• E)the percentage of their loan that will be repaid in a bankruptcy.

---

Definitions:

Hawthorne Studies

A series of experiments on worker productivity conducted at the Hawthorne Works plant in the 1920s and 1930s, which found that employees' performance could be influenced by attention and social factors.

Productivity

The efficiency of production of goods or services expressed by some measure, commonly the ratio of output to input.

Leadership Style

The characteristic approach to leading and influencing team members, shaped by behaviors, attitudes, and communication methods.

Contingent

Depending on something else that might or might not happen, often used to describe conditional situations or employment.