Which of the following characteristics will tend to cause a firm to adopt a more liberal credit policy? I. repeat customers
II) excess capacity
III) high variable costs
IV) limited competition

Question

Quizplus · Accepted Answer

Repeat customers and excess capacity are characteristics that may suggest a firm can take on more credit risk without negative consequences. High variable costs and limited competition would suggest a need for tighter credit policies to prevent losses from default or market pressures.

Which of the Following Characteristics Will Tend to Cause a Firm