Which of the Following Statements Is NOT True of Consumer

question 86

Multiple Choice

Which of the following statements is NOT true of consumer finance companies?

• A)Their borrowers have higher default risk than bank customers.
• B)They charge higher interest rates than banks do on similar loans.
• C)They lend primarily to consumers.
• D)They are strictly regulated by state governments.

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Definitions:

Cartel Members

Firms or countries that coordinate together to control prices and production in an industry, limiting competition.

Incentive to Cheat

Motivations or circumstances that encourage individuals or entities to break rules or agreements for personal gain.

Cartel Agreements

Formal agreements among competing firms in an industry to control prices, limit production, or divide markets, often illegal and against antitrust laws.

Oligopolies

Market forms in which a market or industry is dominated by a small number of sellers (oligopolists).