Tinix Is a Well-Established Petrochemical Company That Holds Excellent Credit

question 29

Multiple Choice

Tinix is a well-established petrochemical company that holds excellent credit ratings in the market. It provides short-term financial capital to other big firms by issuing promissory notes that are HYPERLINK "https://en.wikipedia.org/wiki/Collateral_(finance) " collateralized by HYPERLINK "http://www.investopedia.com/terms/p/physicalasset.asp" physical assets. Which of the following short-term financing options is being offered by Tinix in the given scenario?

• A) Factoring
• B) Asset-backed commercial paper
• C) Trade credit
• D) Line of credit

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Net Exports

The value of a country's total exports minus the value of its total imports, representing the trade balance.

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A regulation set by central banks determining the minimum amount of reserves that must be held by a financial institution, usually a percentage of deposits.

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The interest rate at which depository institutions trade federal funds (balances held at Federal Reserve Banks) with each other overnight.

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