Scenario 9-2. Ryan has just graduated from college with a business degree. He has a wonderful idea for a new business called Ryan's Road Machines. He would like to sell a variety of all-terrain vehicles (ATVs) for the personal use of his selected clientele. Outstanding customer service will be his competitive advantage as he provides individual service to each of his customers. He has just one small problem, no capital. He knows that he must meet the five C's of credit when looking at external funding in order to prove his creditworthiness.
-In Scenario 9-2, a major concern of any provider of funding will be Ryan's ability to repay his loan. This refers to which of the five C's?

Question

Quizplus · Accepted Answer

Capacity refers to the borrower's ability to repay a loan, which is a primary concern for lenders when evaluating creditworthiness.