Answer: Sales promotion ; viral marketing
Explanation: Sales promotions may be explained as technique used by businesses to appease and lure their target market into buying and using their product through the use of appealing incentives such as cost or slash sales, free coupons or discount on purchase and various promotions which are normally not attached to buying the product. Viral marketing in the other hand simply employs the use of internet technology such as mail and social media in the spread of a business campaign and information. It is termed viral marketing as information dissemination can be so rapid when done via this channel.
A plant manager had taken a few measures to try to reduce worker turnover. For four months he monitored the implementation of the measures. He now finds that the turnover rate is reduced by 10 percent. Which step of the rational decision-making model is illustrated in the scenario
Answer:
Evaluating the results.
Explanation:
A Rational decision-making model is demonstrated as the structured and logical decision-making process consisting of various steps beginning from definition and identification of goals to reaching an effective solution after evaluation of plenty of alternatives.
In this situation, 'evaluating the results' is the step of rational-decision making process that is illustrated in this scenario as it aims to assess the effect of the implementation of the best solution selected in the previous step after assessing the problem and evaluating a number of alternatives. This step aims to test whether the solution worked and to give feedback on how to alter future decisions for better results according to this assessment.
Assume that your firm is an importer of Mexican chairs denominated in pesos. Your competition is mainly U.S. producers of chairs. You wish to assess the relationship between the percentage change in the firm’s stock price (SPt) and the percentage change in the peso's value relative to the dollar (PESOt). SPt is the dependent variable. You apply the regression model to an earlier subperiod and a more recent subperiod. In the recent subperiod, you increased your importing volume. You should expect that the regression coefficient in the PESOt variable would be ____ in the first subperiod and ____ in the second subperiod.
Answer:
negative, negative.
Explanation:
So, let us fill in the gap in the question given above. Bother that the capitalized words are the answers to the missing gaps;
" Assume that your firm is an importer of Mexican chairs denominated in pesos. Your competition is mainly U.S. producers of chairs. You wish to assess the relationship between the percentage change in the firm’s stock price (SPt) and the percentage change in the peso's value relative to the dollar (PESOt). SPt is the dependent variable. You apply the regression model to an earlier subperiod and a more recent subperiod. In the recent subperiod, you increased your importing volume. You should expect that the regression coefficient in the PESOt variable would be NEGATIVE in the first subperiod and NEGATIVE in the second subperiod."
This question is all about the measurement of exposure to exchange rate fluctuations. The measurement of exposure to exchange rate fluctuations is done by firms in order to be able to calculate the risk involves in exchange rate fluctuations.
In the problem given Above, as the importing volume increase, we have a negative regression coefficient in the PESOt variable.
J&R Renovation, Inc., is trying to determine its cost of debt. The firm has a debt issue outstanding with 20 years to maturity that is quoted at 107 % of face value. The issue makes semi-annual payments and has a coupon rate of 9 % annually.
A. What is the company's pretax cost of debt?
B. If the tax rate is 35 %, what is the aftertax cost of debt?
Answer:
a) 8.36%
b) 5.43%
Explanation:
to find the pretax cost of debt we must find the yield to maturity:
YTM = {coupon + [(face value - market value) / n]} / [(face value + market value) / 2]
YTM = {45 + [(1,000 - 1,070) / 40]} / [(1,000 + 1,070) / 2] = 43.25 / 1,035 = 0.04178 x 2 = 0.08357 = 8.36%
after tax cost of debt = 8.36% x (1 - 35%) = 8.36% x 0.65 = 5.43%
Action Travel has 10 employees each working 40 hours per week and earning $20 an hour. Federal income taxes are withheld at 15% and state income taxes at 6%. FICA taxes are 7.65% and unemployment taxes are 3.8% of the first $7,000 earned per employee. What is the actual direct deposit of payroll for the first week of January
Answer:
$5,708
Explanation:
Computation of the actual direct deposit of payroll for the first week of January
The First step is to find the total salary expenses
Total salary expenses= 10 employees × 40 hours × $20
Total salary expenses= $8,000
Second step is to calculate the actual direct deposit of payroll
Total salary expense $8,000
Federal income tax rate ($1,200)
($8,000*15%)
State income tax rate ($480)
($8,000*6%)
FICA tax rate ($612)
($8,000*7.65%)
Actual direct deposit $5,708
Therefore the actual direct deposit of payroll for the first week of January will be $5,708
When property rights are well defined and markets are: competitive market equilibrium violates the conditions for economic efficiency.market equilibrium is consistent with economic efficiency.conditions necessary for economic efficiency no longer apply.quantity supplied will rarely equal the quantity demanded.
Complete Question:
When property rights are well defined and markets are competitive, the
Group of answer choices:
a. market equilibrium violates the conditions for economic efficiency.
b. market equilibrium is consistent with economic efficiency.
c. conditions necessary for economic efficiency no longer apply.
d. quantity supplied will rarely equal the quantity demanded.
Answer:
b. market equilibrium is consistent with economic efficiency.
Explanation:
A property right is the exclusive or sole authority which determines the legal ownership of resources and how these resources are to be used, whether by individuals or government.
Also, a competitive market is a type of market that comprises of numerous producers who compete with each other so as to satisfy or meet the material needs and wants of consumers at a specific period of time.
Hence, when property rights are well defined and markets are competitive, the market equilibrium is consistent with economic efficiency.
This ultimately implies that, when the ownership of resources are well defined and markets are competitive, all benefits from trade between the consumers and producers of goods and services has been maximized, and each units creating more benefit to the consumers than cost have been produced in the economy.
The likelihood of a risk event occurring during the implementation of a project goes up as the project progresses. The cost impact of these risk events also goes up as the project progresses.
a. True
b. False
Answer: True
Explanation:
Projects are carried out with the consideration that risk would definitely occur, and during the analysing phase of any project all risk that would evolve are carefully studied and proactive solutions are provided. When starting projects there is definitely a high risk due to the energy of how the work would go but careful implementation helps curb the situation.
The exchange rate is: the price of one nation's currency in terms of the currency of another nation. the amount households will spend on imports. the amount of foreign capital a nation receives when there is a trade surplus. the amount charged by bankers for loanable funds
Answer: the price of one nation's currency in terms of the currency of another nation.
Explanation: The rate of exchange can simply be explained as the worth or value of a country's currency in terms of the currency of another country. It gives an aggregate amount of the value of currency held by a certain person or spent in a particular country in terms of the currency of choice in another country. The exchange rate of currencies is usually determined by the market forces of demand and supply even though some aren't. For example, the rate at which one can convert a certain amount of British pounds to it's equivalent amount in U.S dollar is the exchange rate of British pounds to U.S dollars.
During the market testing stage of the new-product process, a product may be tested multiple times with consumers to get their reactions with test marketing, one type of which is known as
Answer:
Simulated test markets.
Explanation:
During the market testing stage of the new-product process, a product may be tested multiple times with consumers to get their reactions with test marketing, one type of which is known as simulated test markets.
A simulated test market can be defined as a marketing research technique that involves the exposure of consumers to an unreal market in order to observe their reactions to a new product. It involves advertising in stages through a simulated market so as to determine a customer's purchase decision, forecast demand and market analysis for a new product.
Hence, a simulated test market is aimed at observing and analyzing potential customer's reaction to a new product before it's introduced to the market.
A broker represents a seller but is currently working with a buyer to find a home. Assuming that no statute has replaced the traditional common law of agency, which of these correctly identifies the parties in this relationship?
Answer:
A). The broker is the seller's agent; the buyer is the broker's customer.
Explanation:
The first statement most aptly identifies the two different parties in this given relationship. The broker is the seller's agent as he would represent him and assist him in listing his properties for sale as per the terms set by him. This would help the seller in receiving the best price for his property and also in ensuring all the legal requirements to be met in time. The buyer is the broker's customer as he assists him in providing a variety of housing options to choose from according to his needs and requirements. Thus, the broker is representing both the buyer and the seller distinctively. Hence, option A is the correct answer.
Rhonda, a junior accountant at a manufacturing company, was laid off from her job because she rejected multiple requests from the company's chief financial officer to engage in a physical relationship with him. In the context of employment legislation, this scenario best illustrates _____.
Answer: quid pro quo sexual harassment
Explanation:
The scenario represented in the question regarding Rhonda and her company's chief financial officer is referred to as quid pro quo sexual harassment.
Quid pro quo sexual harassment is a situation that occurs when benefits, pay, employment, position, training, title, position are based on the condition that the other individual involved agree to ones sexual advances. It should be noted that this is illegal.
Which of the following would be an effective approach for encouraging authentic feedback? A. Defend yourself if you disagree with criticisms you receive. B. In the beginning, ask for feedback each time you see the person. C. Ask for feedback only when you are open to hearing it. D. only in formal situations, so employees understand the importance of the feedback.
Answer:
C. Ask for feedback only when you are open to hearing it.
Explanation:
Feedback refers to providing the information gathered after evaluating any specific action or event. Providing authentic feed-backs helps in promoting and improving the better quality of the original topic. It is more personalized and user-oriented. There are various ways by which authentic feed-backs can be given. Through messaging, writing, discussing over calls, and conversations over video calls helps in providing authentic feedback. Asking for feedback should be initiated by the person only when the person is willing to listen and acquire those feed-backs is an effective approach for encouraging authentic feedback.
Suppose you are looking at the 2006 results of how the Echo generation classified specified items as either luxuries or necessities. Do you expect the results to reflect how the Echo generation would classify items in 2020? Explain. No, many luxury brands will no longer exist in 2020, and will thus be unavailable for purchase. Newer luxury brands will dominate the lists. Yes, people's ideas of luxuries or necessities rarely change. No, the generation will have aged by 14 years and their perception of items as necessities or luxuries might well have changed by then. Yes, though the generation will have aged by 14 years, their perception of items as necessities or luxuries will not have changed by then. Yes, the costs of luxuries or necessities doesn't change that much with time, so they would still be considered luxuries or necessities in 2020.
Answer:
No, the generation will have aged by 14 years and their perception of items as necessities or luxuries might well have changed by then.
Explanation:
In this the individual perception important. That means if the person considered the necessity so it would not be the necessity after the age of 14 years and if the person considered the luxury so the necessity would be considered for the same person after the age of 14 years
So the necessity and the luxury would be changed as per the perception
Therefore the answer is no.
Q 5.15: At the beginning of January 2017, a company reported inventory of $4,000. During the month, the company made purchases of $17,800. On January 31, 2017, a physical count of inventory reported $4,200 on hand. Find the cost of goods sold for the month.
Answer:
COGS= $17,600
Explanation:
Giving the following information:
Beginning inventory= $4,000
Purchase= $17,800
Ending inventory= $4,200
To calculate the cost of goods sold (COGS), we need to use the following formula:
COGS= beginning finished inventory + cost of goods purchased - ending finished inventory
COGS= 4,000 + 17,800 - 4,200
COGS= 17,600
Dragonfly, publisher of children's books, has purchased White Rabbit, another publisher of children's books. Both companies' books are sold to the same retail stores and schools. Their content is different because Dragonfly produces children's literature, whereas White Rabbit focuses on child-level nonfiction scientific and nature topics. Which of the following statements is probably true about this acquisition?
A. This is a horizontal acquisition.
B. This is an example of virtual integration.
C. Dragonfly is beginning to build a conglomerate.
D. Economies of scope are unlikely to result from this acquisition.
Answer:
C.
Explanation:
conglomerate is a thing consisting of a number of different and distinct parts or items that are grouped together.
A country has been in existence for only two years. In the first year, receipts were $1.0 million and outlays were $1.5 million. In the second year, receipts were $1.5 million and outlays were $2.0 million. At the end of the second year, the government had issued debt worth ______.
Answer: $1 million
Explanation:
From the question, we are informed that a country has been in existence for only two years and that in the first year, receipts were $1.0 million and outlays were $1.5 million. Since outlays us more than revenue, it shows that there's a debt of ($1.5m - $1.0m) = $0.5 million.
In the second year, receipts were $1.5 million and outlays were $2.0 million. This also shows that there is a debt of $0.5 million.
At the end of the second year, the government had issued debt worth:
= $0.5 million + $0.5 million
= $1 million
Zoe is a manager at a large company engaged in the acquisition of a smaller company. The smaller company has operated at a loss for the last three years under three different managers, but Zoe is convinced that she can turn the company around despite the evidence to the contrary. Zoe is engaging in ______.
Answer:
managerial hubris
Explanation:
From the scenario that is being described, it can be said that Zoe is engaging in managerial hubris. This term refers to the unrealistic belief help by a manager that they have the ability to manage an asset of a target firm far more efficiently than that firm's current or previous management, without any actual proof or planning. This is exactly what Zoe seems to be doing by stating that she can make the smaller company profitable even though three previous managers failed to do so.
According to NASAA's Statement of Policy on Unethical or Dishonest Business Practices of Broker-Dealers and Agents, all of the following practices are considered unethical for an agent EXCEPT A) selling 3,000 shares of ABC as directed by a client at a price that the agent determines, without oral or written discretionary authority B) selling 3,000 shares of ABC at a price the agent determines is the best the client can get, without oral or written discretionary authority C) determining the quantity of a specific security to purchase once the client has designated that security and the action to be taken D) receiving written discretionary authority from a client within 10 business days of first executing a discretionary trade with oral authority from the client
Answer: A. selling 3,000 shares of ABC as directed by a client at a price that the agent determines, without oral or written discretionary authority
Explanation:
According to NASAA's Statement of Policy on Unethical or Dishonest Business Practices of Broker-Dealers and Agents, all of the following practices that are given in the question are unethical for an agent except selling 3,000 shares of ABC as directed by a client at a price that the agent determines, without oral or written discretionary authority.
It should be noted that it is ethical for an agent to choose the price and the time of a trade so far the client has determined the amount, asset, and the action.
Assuming that the physical output (i.e., the actual quantity of all final goods and services) of all final goods and services remains constant, if the general price level in the economy triples, so does nominal output.
a) true
b) false
Answer:
a) true
Explanation:
A rise in the general price level is called inflation and it affects the nominal value of the company's output. E.g. you sell pants and last year they sold at $10 and now since inflation rate is 10%, they sell at $11. But inflation only affects nominal values, it doesn't affect real values which are calculated using a base price of a certain year X, times the quantity sold. Following the example, your real output would not be $11 per pair of pants, instead it would still remain at $10 since the inflation is discounted.
Omni Healthcare's analgesic drug Cetaprin has a 40% share in the analgesics market in the country of Terrania. Its closest competitor, Febex, has a 25% share in the market, while four other analgesic brands split the remainder. Which statement indicates that Cetaprin is a cash cow according to the BCG matrix
Answer:
C) The demand for analgesic drugs in the Terranian market is expected to remain stable.
Explanation:
The options were missing:
A) Omni Healthcare often takes money from other strategic business units to support Cetaprin. B) A customer survey shows that Cetaprin users do not prefer it to other analgesics in the market. C) The demand for analgesic drugs in the Terranian market is expected to remain stable. D) Febex is rapidly gaining market share over Cetaprin due to aggressive marketing efforts. E) The Terranian market for healthcare products is expanding rapidly.A cash cow is a mature product that is sold in a slow growth market, but holds a significant market share, and generate large and constant cash inflows to the company.
Suppose the board of Nathan Corporation decided to do the share repurchase in problem 1-part b, but you, as an investor, would have preferred to receive a dividend payment. How can you leave yourself in the same position as if the board has elected to make the dividend payment instead
Answer:
If we sell 0.5 / 15 of one share we will receive $0.50 and the remaining shares will worth $14.50. This will be the same position as if the firm had paid a dividend.
Explanation:
Nathan Corporation is deciding to whether to repurchase shares. It is a decision made by company and its management to boost value of its stock. If the board makes a decision to make dividend payment then we will receive $0.50 per share. The share price total will be $14.50 which is same whether we receive dividend or not.
Power Drive Corporation designs and produces a line of golf equipment and golf apparel. Power Drive has 100,000 shares of common stock outstanding as of the beginning of 2021. Power Drive has the following transactions affecting stockholders' equity in 2021.
March 1 Issues 55,000 additional shares of $1 par value common stock for $52 per share.
May 10 Purchases 5,000 shares of treasury stock for $55 per share.
June 1 Declares a cash dividend of $1.50 per share to all stockholders of record on June 15. (Hint: Dividends are not paid on treasury stock.)
July 1 Pays the cash dividend declared on June 1.
October 21 Resells 2,500 shares of treasury stock purchased on May 10 for $60 per share.
Required:
Record each of these transactions.
Answer and Explanation:
The journal entries are shown below:
On March 1
Cash Dr (55,000 × $52) $2,860,000
To Common stock (55,000 × $1 per share) $55,000
To Additional paid in capital - common stock $2,805,000
(Bein the issuance of the common shares are recorded)
On May 10
Treasury stock Dr (5,000 shares × $55) $275,000
To Cash $275,000
(being the purchase of treasury stock)
On June 1
Dividend Dr (150,000 shares × $1.50) $225,000
To Dividend payable $225,000
(Being the cash dividend is declared)
On July 1
Dividend payable Dr (150,000 shares × $1.50) $225,000
To cash $225,000
(being the dividend paid is recorded)
On October 21
Cash Dr (2,500 shares × $60) $150,000
To Treasury stock (2,500 shares × $55) $137,500
To Additional paid in capital - treasury stock $12,500
(Being the reissuance of the treasury stock is recorded)
Xerox, the U.S. Postal Service, and McDonald's have enjoyed significant market power in the past. List and explain three major factors that have eroded this market power. Market power is eroded when A. better substitutes become available because the market has less competition. B. fewer substitutes are available because the market has less supply. C. no substitutes are available because consumers have no choices. D. better substitutes become available because consumers will not be willing to pay as much for a good. E. fewer substitutes are available because consumers are more sensitive to prices.
Answer:
Correct Answer:
E. fewer substitutes are available because consumers are more sensitive to prices.
Explanation:
Market power is the ability of a company to successfully influence the pricing of its products or services in the overall marketplace. This is common among most big corporations that produces consumer goods and offer services.
This market power can be influenced by some factors. On the other-hand, the market power could be eroded leading to inability of the companies to influence prices do to the following:
1. Number of companies in the market: The lower the companies producing same product in the market, the higher the chances of the companies to be able to influence market prices. Otherwise, the market power will be eroded due to high number of companies.
2. Elasticity of demand: The persistent demand of a product by people helps to determine the market power of those companies. When this is lacking, the market power is eroded.
3. Product differentiation: The ability of a company to provide a unique product that offers good services in a market helps it to achieve market power. Lack of these erodes the market power.
Airbase is a consumer electronics company known for its affordable mobile devices that follows a cost-leadership strategy. In this scenario, Airbase should ideally compare its strategic position with:__________.
1. a company that sells small kitchen appliances at affordable prices.
2. an online company that sells customized electronics accessories.
3. a consumer electronics company that sells high-end devices.
4. a consumer electronics company popular among price-conscious customers.
Answer: 4. a consumer electronics company popular among price-conscious customers.
Explanation: Companies who thread a cost-leadership strategy or path could be said to be 'price-centric', that is gives price huge cognizance and will strive to be a market or industry leader when it comes to giving best and most affordable prices on products.
Thus, since Airbase follows a cost leadership strategy and also popular among consumers for its affordable devices, it should also weigh or compare it's strategy to other consumer electronics company which is popular among consumers which gives cognizance to price of products they purchase.
Beth is the assistant store manager at a trendy clothing store. The store hires lots of seasonal employees. Beth has little regard for the skill or ability of those she hires, and she is certain that few would come to work on time each day if it weren't for the fact that the store is known to fire any employee who fails to be on time. As a student of motivational theory, you would describe the management style of Beth as
Answer:
The correct answer will be "Theory X".
Explanation:
Through Theory X, alternatives to administration may range across a hard methodology to another soft one. The hard or challenging framework is focused on intimidation, overt threats, small compared oversight as well as tighter restrictions, which are control or perhaps management system.One such approach to management believes the average employee seems to have little motivation, lacks accountability, and therefore is structured to individual objectives.So you might well characterize Beth's leadership approach as Theory X as being a graduate of motivation factors.
Humble leaders display all of the following key qualities valued by employees except Multiple Choice appreciation of others. low self-awareness. openness to feedback. appreciation of the greater good. low self-focus.
The correct answer is B) low self-awareness.
Humble leaders display all of the following key qualities valued by employees except low self-awareness.
What employees value is high self-awareness, the appreciation of others, openness to feedback, appreciation of the greater good, and low self-focus.
A true leader is an individual who not only leads but teaches others how to lead to. For this to happen, trust is a key value so the employees can feel that indeed there is a true team atmosphere in the organization. Employees must feel appreciated, valued, and motivated through a common goal. That is why it is so important that the leader sets the example all the time.
Low self-awareness should not show the key qualities valued by employees.
The following information should be considered for key qualities:
Appreciation of others.Openness to feedback. Appreciation of the greater good. Low self-focus.Also, low self-awareness represents the value of an employee that should be harmful for everyone.
Therefore we can conclude that Low self-awareness should not show the key qualities valued by employees.
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A mortgage-loan officer persuades unsuspecting consumers to sign up for exotic mortgages, such as "option ARMs." These mortgages offer borrowers the choice to pay less than the required interest, which is then added to the principal while the interest rate can adjust upward. Because of this setup, many borrowers are unable to repay the mortgage once the interest rates go up. Which of the following phrases best describes this scenario? (CSLO 4)
A. legal but not ethical
B. legal and ethical
C. neither legal nor ethical
D. ethical but not legal
Answer: A. legal but not ethical
Explanation: Introducing mortgage plans to consumers in other to cater for their needs by a mortgage-loan officer is not a legal crime which will be penalized by the law. However, it is an ethical obligation on the path of the mortgage-loan officer to explain the modalities attached to a certain mortgage plan to consumers, both the advantages and the demerits. In the options ARM mortgage plan, it affords consumers to pay below the interest rate on the mortgage, this short paid interest are later added to the principal and the rates increases. This may cause a lot more harm than good to consumers who do not have detailed knowledge of this particular loan process.
Aspen, Inc. developed a new horse transport device and incurred research and development costs of $250,000. Rather than continue with their own research, Aspen decided to purchase a patent for a similar design from Vail, Inc. for $350,000. What are the total assets and expenses for these developments
Answer:
Total assets= $350,000
Total expenses= $250,000
Explanation:
Aspen incorporation developed a new horse transport device
During the period of the research and development of this transport device a lot of costs were incurred
Expenses can be described as the amount of money that is spent by a company inorder to generate profit
In the scenario described above, Aspen incorporation incurred $250,000 during the period of the transport device development
Hence the total amount of expenses is $250,000
Patent can be described as a type of intangible assets that, although this type of assets is a bit hard to estimate it's value, it is still grouped as an asset.
It is a full right that is given to an organisation, it gives them complete control and access to manufacture or produce a particular product for a long time.
In the scenario described above, Aspen purchased an identical design from Vail incorporation for $350,000
Hence the total assets is $350,000
If a firm is worried about distance, country risk, employee morale, intellectual property protection, legal issues, and obtaining specialized talent, then which option is likely the best for this firm
Options:
Offshore
Outsource
Keep in-house
Keep domestic
Answer: keep domestic
Explanation: The recruitment options embarked upon by firms may affect the policies or type of processes the firm's employ in overseeing their recruitment process. For firms who seems skeptical about issues relating to distance, legal issues, country risk, morale and other issues listed above, such firms will best be better placed to oversee a hiring process which is restricted to the local environment which the firm is well informed about and devoid of international and legal barriers, oversea culture and mentality which may hamper or affect the required hiring structure of the firm.
Which of the following statements is true about the constant growth model?
A- the constant growth model can be used if a stock's expected constant growth rate is more than its required return
B- The constant growth model can be used if a stock's expected constant growth rateis less than its required return
Answer: The constant growth model can be used if a stock's expected constant growth rate is less than its required return.
Explanation:
The Constant Growth Model is a stock valuation method.
It assumes that a company's dividends are increasing at a constant growth rate indefinitely.
Formula: Current price = (Next dividend the company is to pay) ÷ (required rate of return for the company - expected growth rate in the dividend.
When expected constant < required return, then the constant growth model can be used.
Hence, the statement is true about the constant growth model :
The constant growth model can be used if a stock's expected constant growth rate is less than its required return.
If a stock's predicted constant growth rate is smaller than its needed return, the constant growth model can be utilized.
So, option B is correct.
Define constant growth model.The constant growth model is used to calculate a stock's inherent value depending on a succession of dividends that increase at a constant pace in the future.
Dividends per share, the growth rate of dividends per share, as well as the rate of return are the three inputs inside the constant growth model.
If a stock's predicted constant growth rate is smaller than its needed return, the constant growth model can be utilized.
So, option B is correct.
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the difference between a secured loan and unsecured loan is that the secured loan is
Answer:
Explanation:
A secured loan is a type of loan on which the borrower uses some assets for collateral . That means it is secured on the assets in the case of any default in terms by the borrower.
An unsecured loan on the other hand is a type of loan that is not secured on any assets . The risks related to this type of loan is higher as there is no security to cover or minimize the loss in the situation of a default in terms.
Looking at the definition given above , the difference between a secured and unsecured loan is that assets are promised by the borrower as security over a secured loan , hence the cost can be lower while in the unsecured loan , no asset is promised as security and the cost can be higher
Answer:
has a lower interest rate
Explanation: