If You Were Asked to Loan Money to a Company

question 15

Multiple Choice

If you were asked to loan money to a company that you feared may be getting into financial difficulties, which of these courses of action would provide you with the most protection from default on the loan?

• A)Rely on the principle of limited liability.
• B)Require a mortgage over a specific asset of the company.
• C)Require the accounts of the company to be audited.
• D)Specify a particular accounting method to be used.

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Definitions:

Memorizing Positions

Memorizing Positions involves learning and recalling the location or arrangement of objects or elements in a particular space or sequence.

Memorizing Position

The process of learning or committing to memory the location or arrangement of items or factors in a particular sequence or spatial layout.

Chess Board

A square board used in the game of chess, consisting of 64 smaller squares, arranged in an 8x8 grid.

Randomly Arranged

Items, subjects, or events are placed or selected without a specific pattern, order, or purpose, ensuring an unbiased distribution.