11-37 Discriminant Models Often Ignore Hard-To-Quantify Factors in the Credit

question 71

True/False

11-37 Discriminant models often ignore hard-to-quantify factors in the credit decision.

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Definitions:

Accountant

A professional responsible for maintaining and interpreting financial records, ensuring accuracy and compliance with laws and regulations.

Net Present Value

The calculation used to find today’s value of a stream of future payments or receipts, by discounting them using a specific rate of return.

Investment

Investment refers to the allocation of resources, such as capital, time, or assets, with the expectation of generating profit or income, involving mechanisms like stocks, bonds, real estate, or other financial vehicles.

Present Value Factors

Multipliers used to calculate the present value of a future sum of money or stream of cash flows given a specific interest rate.