Which of the following may fall under the category of collateral?(1 point)

Responses

a high salary
a high salary

an antique vase valued at $125,000
an antique vase valued at $125,000

a credit card balance of $12,000
a credit card balance of $12,000

a previous loan that was repaid in full
a previous loan that was repaid in full

1 answer

In the context of collateral, the correct response would be:

an antique vase valued at $125,000

Collateral refers to an asset that a borrower offers to a lender to secure a loan. If the borrower defaults on the loan, the lender can claim the collateral to recover the owed amount. A high salary, a credit card balance, and a previous loan that was repaid do not qualify as collateral, as they do not represent tangible assets that can be seized by a lender.