For Most Lines of Business the Basic Source of Short-Term

question 112

Multiple Choice

For most lines of business the basic source of short-term loan financing is:

• A) commercial banks
• B) finance companies
• C) the commercial paper market
• D) factors

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Definitions:

Dishonor

The refusal or failure to accept or pay a bill of exchange, promissory note, or other negotiable instrument when due.

Primary Liability

The direct responsibility to pay or compensate for a loss or damage, without the necessity to seek contribution from others.

Cashier's Checks

A check guaranteed by a bank, drawn on the bank's own funds and signed by a cashier.

Capacity

The legal ability of a person to enter into a contract, often determined by factors such as age, mental competency, and legal status.