Which of the Following Is Not a Characteristic of Short-Term

question 220

Multiple Choice

Which of the following is not a characteristic of short-term financing?

• A) It must be repaid within three years.
• B) It is easier to obtain than long-term financing.
• C) There is less risk of nonpayment to the lender.
• D) The amounts are usually smaller than amounts obtained through long-term sources.
• E) There is a close working relationship between borrower and lender.

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Definitions:

Multiple Solutions

Situations where more than one answer or approach can satisfy the conditions of a problem.

MIRR

Modified Internal Rate of Return, a financial measure used to evaluate the attractiveness of investments, taking into account the cost of capital and the reinvestment rate.

Cost of Capital

A minimum profit rate a business has to achieve on its ventures to sustain its market price and appeal to investors.

MIRR

Modified Internal Rate of Return, a financial measure used to evaluate the profitability of investments, adjusting for differences in cash flow timing and reinvestment rates.