A Term Loan Is Usually Characterized By

question 51

Multiple Choice

A term loan is usually characterized by:

• A) maturity of ten to fifteen years.
• B) a zero interest rate.
• C) monthly or quarterly instalment payments.
• D) securitization of inventory.

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Definitions:

Unlimited Liability

The liability of the sole proprietor or the partners for all debts incurred by the business to the extent of their personal resources.

Sole Proprietorship

A business owned and operated by a single individual, where there is no legal distinction between the owner and the business entity.

Incorporated

A legal process whereby a business entity is formed as a distinct legal entity, separate from its owners, with its own rights and liabilities.

Principal

The main party to a transaction or contract who has a primary interest and authority in the context considered.