A firm is experiencing cash flow difficulties. Which of the following types of loans would allow it to obtain cash in the easiest manner? Select one: a. They have a committed line of credit on which they owe nothing presently

A firm is experiencing cash flow difficulties. Which of the following types of loans would allow it to obtain cash in the easiest manner? Select one: a. They have a committed line of credit on which they owe nothing presently

Essentials of Economics (MindTap Course List)

8th Edition

ISBN:9781337091992

Author:N. Gregory Mankiw

Publisher:N. Gregory Mankiw

Chapter19: The Basic Tools Of Finance

Section: Chapter Questions

Problem 2PA

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Question

give the correct answer with explanation

A firm is experiencing cash flow difficulties. Which of
the following types of loans would allow it to obtain
cash in the easiest manner?
Select one:
a. They have a committed line of credit on which they
owe nothing presently
b. They have an uncommitted line of credit which they
have drawn to the limit
c. They can issue new long-term bonds
d. They can apply for a short-term unsecured loan
e. They can apply for a secured loan

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