11-76 How Can Discriminant Analysis Be Used to Make Credit

question 61

Multiple Choice

11-76 How can discriminant analysis be used to make credit decisions?

• A)By discriminating between good and bad borrowers.
• B)By using statistical analysis to predict the default probabilities.
• C)By using statistical analysis to isolate and weight factors to arrive at default risk classification of a commercial borrower.
• D)By using statistical analysis to bypass qualitative credit decision making.
• E)By updating FI bankruptcy experiences.

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Definitions:

Ergonomics

The study of designing equipment, devices, and processes that fit the human body and its cognitive abilities.

Flextime

A flexible work arrangement that allows employees to choose their start and finish times, while still working the required number of hours.

Technocentric

A viewpoint that centers technology as the primary driver of societal change and progress.

Commuting Pressures

Stress and challenges experienced by individuals during their daily travel to and from work.