The set of rules that determines whether or not credit should be extended is known as:
A) credit analysis.
B) credit policy.
C) multiple discriminate analysis.
D) the terms of trade credit.

Question

Quizplus · Accepted Answer

Credit policy refers to the set of criteria used to determine whether or not to extend credit to a particular customer. It typically includes guidelines for assessing the creditworthiness of a customer, as well as the terms and conditions under which credit will be extended. Credit analysis (A) is a component of credit policy that involves evaluating the financial and credit history of a customer. Multiple discriminate analysis (C) is a statistical technique used in credit analysis to predict the likelihood of default. The terms of trade credit (D) refer to the specific payment terms and conditions agreed upon for a particular credit transaction, which are often determined by the credit policy.

The Set of Rules That Determines Whether or Not Credit