Pledges of Accounts Receivable Are Normally Made on a Notification

question 47

True/False

Pledges of accounts receivable are normally made on a notification basis because the lender does not trust the borrower to collect the pledged account receivable and remit these payments as they are received.

Understand the concept of price discrimination and its impact on consumer groups.

Analyze the effect of perfect price discrimination on economic welfare, consumer surplus, and profits.

Recognize the conditions necessary for effective price discrimination.

Differentiate between various examples and non-examples of price discrimination.

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Definitions:

Ratings

Assessments or evaluations used to rank or score entities based on certain criteria, such as financial strength or quality.

Money Market Instruments

Financial instruments that provide liquidity and short-term financing in the money market, such as treasury bills, commercial paper, and certificates of deposit.

High-risk Securities

Financial instruments that offer a high potential return but also present a higher likelihood of loss.

Quick Resell

The act of selling an item or property soon after its purchase, typically to capitalize on market conditions or make a quick profit.