An investor is not at risk for nonrecourse borrowings, stop-loss arrangements, no-loss guarantees, or borrowings in which the lender has an interest.

Question

Quizplus · Accepted Answer

Nonrecourse borrowings, stop-loss arrangements, no-loss guarantees, and borrowings in which the lender has an interest shift the risk away from the investor and onto the lender or other party involved in the arrangement. Therefore, the investor is not at risk in these situations.

An Investor Is Not at Risk for Nonrecourse Borrowings, Stop-Loss