Which of the Following Is a Cost of Granting Credit

question 16

Multiple Choice

Which of the following is a cost of granting credit?

• A)the opportunity cost of funds being tied up
• B)all the options are costs of granting credit
• C)administration costs for managing receivables
• D)the cost of carrying slow payers and bad debts

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Definitions:

Demand Curve

A graphical representation showing the relationship between the price of a goods or services and the quantity demanded.

Substitutes

Products or services that can be used in place of each other, satisfying the same needs or wants of the consumer.

Monopolist

A single seller in a market who has significant control over the entire supply of a good or service, and thus can influence price.

Marginal Revenue

The additional income generated from selling one more unit of a product or service.