The volatility of business conditions in some countries increase the risk of defaults on accounts receivable in those countries,but that risk may be offset by:
A)lower cost of credit in those countries as volatility increases.
B)the potential for increased sales in those countries as business conditions improve.
C)higher inflation rates in those countries as volatility decreases.
D)investment opportunities in those countries.

Question

Quizplus · Accepted Answer

Although there may be increased risk of defaults on accounts receivable in countries with volatile business conditions, there is also the potential for increased sales as business conditions improve. This could offset the risk and lead to overall profitability.

The Volatility of Business Conditions in Some Countries Increase the Risk