1. Credit exposures should be continually monitored by lender so loan settlement can be accelerated if the borrower's financial condition begins to deteriorate beyond acceptable levels. (True/False)

2. employees pose both upside and downside risk to a company. Downside risk can be reduced by treating employees fairly. (True/False)

3. Firm A lends $1 million to firm X. Firm B lends $2 million to Firm X but the loan made by Firm B is secured by a plane worth $4 million. Firm A's loan is unsecured. Firm A has a more at risk. (True/False)