Banks may deny creditworthy borrowers loan requests if a. they are non-corporate entities b. they are on late on paying taxes c. the loan is too risky d. they are individuals

When a lender refuses to make a loan, although borrowers are willing to pay the stated interest rate or even a higher rate, the bank is said to engage in strategic holding out. collusive behavior. coercive bargaining. credit rationing.

eceivables arise due to a deferred sale, and companies are often unable to collect all their debts, which means that part of those debts may become non-existent or there is doubt about the possibility of collection. 1- What is the difference between bad debts and doubtful debts?   2- Draft an example (supported by numbers) to explain the method of doubtful debts in dealing with bad debts, provided that the explanation includes accounting restrictions and the impact on the financial statements?   3- Explain why the use of the direct method (bad debt method) conflicts with generally accepted accounting principles?   4- One of the methods for estimating doubtful debts is the deferred sales method, the receivables balance method, and the receivables aging method. Required: Formulate an example (enhanced by numbers) to explain the method of aging receivables in estimating doubtful debts, taking into account the following: (1) the number of clients should be 10 clients, (2) the percentages…

The following is true of deposit insurance, except   a Depositor no longer has incentives to monitor the activities of the bank         b Moral hazard dissuades the bank manager from taking risky projects        c In theory, regulators have replaced depositors in the monitoring of banks       d Moral hazard encourages the bank manager to take on risky projects