Harvey Singer recently graduated from college and wants to borrow $50,000 to start a business, which he believes will produce a cash flow of at least $10,000 per year. As a student, Harvey was active in clubs, held many leadership positions, and did a lot of community ser-vice. He currently has no other debts. He owns a car worth about $10,000 and has $6,000 in a savings account. Although the economy is currently in a recession, economic forecasters expect the recession to end soon. If you were a bank loan officer, how would you evaluate Harvey’s loan request within the context of the “5 C’s of Credit”? Briefly describe each characteristic and indicate whether it has favorable or unfavorable implications for Harvey’s loan request.
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