Which of the Following Is Not a Cost of Granting

question 17

Multiple Choice

Which of the following is not a cost of granting credit to customers?

• A) The opportunity cost of funds being tied up.
• B) Administration costs for managing receivables.
• C) Attracting new customers.
• D) The cost of carrying slow payers and bad debts.

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Definitions:

Positive-Sum Game

In game theory, a game in which the gains (+) and losses (−) add up to more than zero; one party’s gains exceed the other party’s losses. A strategic interaction (game) between two or more parties (players) in which the winners’ gains exceed the losers’ losses so that the gains and losses sum to something positive.

Positive Payoffs

Benefits or gains that are realized from an investment or action, often assessed in terms of profitability or value added.

Players

Individuals or entities actively involved in a process or activity, often used in the context of games, sports, or markets.

Zero-Sum Game

A zero-sum game refers to a situation in economic theory where one participant's gain or loss is exactly balanced by the losses or gains of the other participants.