If a fiRm Sells a flOor at 6% This Will

question 50

Multiple Choice

If a firm sells a floor at 6% this will:

• A)pay the holder the LIBOR interest below 6%.
• B)pay the firm 6% on their purchase.
• C)pay the holder the LIBOR interest above 6%.
• D)limit the amount of borrowing to 6% of assets.
• E)None of the above.

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Definitions:

Loathsome Communicable Disease

A highly contagious disease that is viewed with disgust and generally requires reporting to public health authorities due to its nature.

Improprieties

Actions or behaviors that are inappropriate, unethical, or considered wrong.

Elements of Fraud

Factors that must be present to prove fraud, including misrepresentation of a material fact and intent to deceive.

Misrepresentation

A false statement of fact made by one party to another, which has the effect of inducing that party into a contract.