Which of the Following Statements Is FALSE

question 6

Multiple Choice

Which of the following statements is FALSE?

• A)Commercial banks,finance companies,and factors,which are firms that purchase the receivables of other companies,are the most common sources for secured short-term loans.
• B)The factoring arrangement may be without recourse,in which case the lender bears the risk of bad-debt losses.
• C)In a floating lien,general lien,or blanket lien arrangement,specific inventory is used to secure the loan.
• D)If a firm sells its goods on terms of net 30,then the factor will pay the firm the face value of its receivables,less a factor's fee,at the end of 30 days.

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Definitions:

Predatory Pricing

The strategy of setting prices at a very low level with the intent to eliminate competition, considered illegal in many jurisdictions.

Price Discrimination

The strategy of selling the same product to different customers at different prices based on their willingness to pay.

Resale Price Maintenance

A practice where a manufacturer and its distributors agree on the minimum price at which a product can be sold to consumers.

Vertical Price Fixing

A form of price fixing where participants at different levels of the same supply chain coordinate to control prices, often illegal.