Montreal Metals Issues Commercial Paper with a Face Value of $600,000

question 10

Multiple Choice

Montreal Metals issues commercial paper with a face value of $600,000 and a maturity of two months.The firm receives $594,000 when it sells the paper.If the prime rate is 7% APR compounded monthly,how much interest savings did Montreal Metals realize by using commercial paper?

• A)$736
• B)$7,020
• C)$6,000
• D)$950
• E)$1,020

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Definitions:

Espoused Values

The explicitly stated values and norms that an organization claims to hold.

Archetype

A very typical example of a certain person or thing, often used in psychology to describe universally recognized symbols or patterns of behavior.

Fraud

Is a deliberate deception to secure unfair or unlawful gain, often financial.

Leader Behaviors

Actions and mannerisms exhibited by leaders that influence their effectiveness in guiding and motivating followers.