During the Last Year You Have Had a Loan Commitment

question 97

Multiple Choice

During the last year you have had a loan commitment from your bank to fund working capital for your business. The total line available was $10,000,000, of which you took down $7,800,000. It is now the end of the loan commitment period and your bank had you pay the back-end fees. You have misplaced the paperwork that listed the terms of the commitment, but you know you paid total fees (this does not include any interest paid to borrow the $7,800,000) of $51,200 on this loan commitment. You remember that the back-end fee was 112 basis points. Calculate the front-end fee on this loan commitment.

• A) 31 basis points
• B) 27 basis points
• C) 25 basis points
• D) 23 basis points

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Definitions:

Opponent-Process Theory

A theory of color vision and emotion that explains how contrasting colors and emotions are processed in relation to each other.

Lateral Inhibition

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The part of the cerebral cortex that processes visual information.

Semicircular Canals

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