All of the Following Are True of Maximum and Minimum

question 6

Multiple Choice

All of the following are true of maximum and minimum limits for conventional loans EXCEPT:

• A) Fannie Mae/Freddie Mace set new limits each year for their conventional/conforming loans
• B) if a prospective loan exceeds an institution's in-house limit, other lenders may join in a participation loan
• C) setting minimum limits for loan amounts is a possible violation of the Fair Housing Act
• D) all states set limits on the maximum amount for residential loans within the state

---

Definitions:

Deficit Financing

The practice of funding government spending through borrowing rather than through taxation, leading to a government deficit.

Interest Charges

The charge applied by a lender on a borrower for asset utilization, indicated as a percentage of the principal value.

CCC (Cash Conversion Cycle)

A gauge determining how long a company takes to convert investments in stock and other resources into cash flows from sales operations.

Working Capital Management

The management of a company’s short-term assets and liabilities to ensure its continued operation and maximize financial efficiency.