Which Statement Is Correct

question 63

Multiple Choice

Which statement is correct?

• A)A transfer with recourse means that the purchaser of the receivables takes the collection risk.
• B)A transfer without recourse means that the seller of the receivables takes the collection risk.
• C)Factoring with recourse reduces a current ratio that is >1.
• D)Factoring without recourse creates a liability on the balance sheet.

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Definitions:

Resource Demand Curve

A graph showing the relationship between the price of a resource and the quantity of that resource demanded by firms.

Imperfectly Competitive

A market structure where the conditions for perfect competition are not fully met, including monopolistic competition and oligopoly.

Purely Competitive

A market scenario where there are many buyers and sellers, each has no influence over the price of products, leading to perfect competition.

Marginal Resource Cost

The additional cost incurred by producing one more unit of a product or service, especially in terms of the resources used in its production.