What Is the Difference Between a Line of Credit and a Revolving

question 309

Multiple Choice

What is the difference between a line of credit and a revolving credit agreement?

• A) A line of credit is normally used by charitable and public-sector organizations, while a revolving credit agreement is usually used by private-sector business firms.
• B) More money can be borrowed with a line of credit than with a revolving credit agreement.
• C) There is no guarantee that the money will be available when it is requested in a line of credit, but there is an agreement that it will be available when requested in a revolving credit agreement.
• D) A line of credit is only obtainable from a credit union, while a revolving credit agreement is only obtainable from a bank.
• E) All of these are correct.

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