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Mid-term test (Banking II)

I. T/F statements and correct the false ones: a. Factoring can take away many disadvantages for businesses. b. Some businesses by paying their bills late. c. Most business relies on giving credit to their customers. d. Factor is the business which wants to buy suppliers unpaid invoices. e. Full factoring is one of the main forms of the factoring. f. The factors purchase debts at their own risk, i.e they buy debts without recourse. g. The supplier can regulate his cash flow position by using factoring service. h. Credit offered by shops, banks is a consumer credit. i. Paper showing that money has been paid or something has been received is an invoice. j. Competition forces suppliers have a chance to provide credit for their customers. II. Word-form: a. Factoring is ..to suppliers in difficulty of capital. (advantage) b. My companys debt remains .to level (too big to be repaid) (manage) c. The .of this porduct is high because of .prices. (market/compete) d. She is a person.who specialize. In the financial sector. (special). III. Complete the following sentences: a. Trade credit isis the kind of credit which is offered by one business to another business when they are trading consumer credit is the kind of credit which is given by bank or shop to enable their custome can buy goods . b. Factoring is a way of raising money from unpaid invoices .. c. Before deciding to purchase debts, the factor needs to assess the creditworthiness and credit status of the customer who are given credit. d. Without recourse factoring means the factor will buy debts at their own risk . e. If the buyer is thought to be a good risk customer, the factor decides to buy debts without recourse .