ECONOMICS (CBSE/UGC NET)

ECONOMICS

CREDIT

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Question [CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]

The fact that Ed owns two apartment buildings made it easier for him to obtain a loan. This will affect which of the 3 C’s?

A	Capacity
B	Character
C	Capital
D	Credibility

Explanation:

Detailed explanation-1: -Students classify those characteristics based on the three C’s of credit (capacity, character, and collateral), assess the riskiness of lending to that individual based on these characteristics, and then decide whether or not to approve or deny the loan request.

Detailed explanation-2: -Character: refers to how a person has handled past debt obligations: From the credit history and personal background, honesty and reliability of the borrower to pay credit debts is determined. Capacity: refers to how much debt a borrower can comfortably handle.

Detailed explanation-3: -The factors that determine your credit score are called The Three C’s of Credit-Character, Capital and Capacity. These are areas a creditor looks at prior to making a decision about whether to take you on as a borrower.

Detailed explanation-4: -Lenders score your loan application by these 5 Cs-Capacity, Capital, Collateral, Conditions and Character. Learn what they are so you can improve your eligibility when you present yourself to lenders. Capacity.

There is 1 question to complete.