The Major Source of Risk Exposure Resulting from Issuance of Standby

question 23

Multiple Choice

The major source of risk exposure resulting from issuance of standby letters of credit is:

• A) technology risk.
• B) interest rate risk.
• C)C.credit risk.
• D) off-balance-sheet risk.

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Definitions:

Elements of Causation

Fundamental components required to establish a cause-and-effect relationship in a legal context, typically including direct cause, foreseeability, and harm.

Proximate Cause

The primary cause that in a natural and continuous sequence, unbroken by any efficient intervening cause, produces an event and without which the event would not have occurred.

Cause in Fact

A legal principle that establishes an event as the direct cause of an injury, required for proving negligence.

Res Ipsa Loquitur

A doctrine in tort law that infers negligence from the very nature of an accident or injury, in the absence of direct evidence on how any defendant behaved.