What is the problem with using the original LTV to assess the likelihood that a seasoned mortgage will default?
What will be an ideal response?
At one time, investors considered only the original LTV in their analysis of credit risk. Because of periods in which there has beena decline in housing prices, the current LTVhas become the focus of attention. Thecurrent LTV is the LTV based on the current unpaid mortgage balance and the estimatedcurrent market value of the property. Specifically, the concern is that a decline inhousing prices can result in a current LTV that is considerably greater than the originalLTV. This would result in greater credit risk for such mortgage loans than at the time oforigination. Thus, the current LTV (as opposed to the original LTV) is much better equipped to assess the likelihood that a seasoned mortgage will default.
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The analysis of business transactions is facilitated by
a. reconciliation of bank balances at the end of the reporting period. b. good internal controls and performing daily cash reconciliation. c. developing an electronic spreadsheet showing the transactional effects. d. maintaining a written copy of all invoices and receipts of the company for a period of at least 7 years. e. None of these answer choices is correct.
The U.S. Supreme Court case Virginia State Board of Pharmacy v. Virginia Citizens Consumer Council did which of the following?
A. Formed the basis of the modern practice of advertising B. Extended from individuals to organizations the First Amendment protection of commercial speech C. Required corporate commercial speech to be non-misleading D. All of the above E. None of the above
Enumerated or bulleted lists
a. should be placed only in an appendix section of a business document. b. detract from the flow of the written message. c. can be used to add visual impact to items in a series. d. result in too much wasted white space in a business document.
Charter Communications uses the order-call ratio to measure the performance of its salespeople. If, in the past year, a salesperson made $13 million in sales, called on 4,312 potential business customers (either by phone or in person), and got 1,216 orders, what was this sales rep's order-call ratio (to the nearest whole number percentage)?
A. 12 percent B. 355 percent C. 36 percent D. 28 percent E. 18 percent