Which One of the Following Best Defines the Term 'Credit

question 1

Multiple Choice

Which one of the following best defines the term 'credit scoring'?

• A)categorising customers into groups depending upon the length of time it takes each customer to pay for purchases
• B)process of quantifying the probability of default when granting credit to customers
• C)compiling a list of accounts receivables segregated by the length of time each receivable has been outstanding
• D)evaluating the opportunity costs of a credit policy
• E)tracking of both the number and the size of customer orders over a period of time

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Definitions:

Leisure

Leisure refers to the time available to an individual when not engaged in work, when one can relax, engage in recreational activities or hobbies.

Nonlabor Income

Income received from sources other than direct employment or labor, such as investments, retirement pensions, or social security benefits.

Wage Rate

The standard amount of compensation given for the performance of specific services, typically expressed per hour, day, or other periods of work time.

Budget Equation

An equation that represents the relationship between income, savings, and expenses.