The Total Amount of Interest Expense Over the Life of a Note

question 69

Multiple Choice

The total amount of interest expense over the life of a note is:

• A)The face value times the face interest rate times the number of interest payments over the life of the note.
• B)The face value of the note times the market interest rate times the number of interest payments over the life of the note.
• C)The total of the cash outflows of the note over the life of the note less the proceeds of the note.
• D)The proceeds of the note plus the cash interest paid less the maturity value of the note.

---

Definitions:

Corporate Opportunity

A business opportunity that a company must offer to its shareholders or members before taking it for personal gain.

Duty of Disclosure

The legal obligation to reveal all material facts or information relevant to a transaction or decision-making process.

Duty of Care

A legal requirement that demands individuals or organizations to exercise a reasonable degree of attention and caution to avoid negligence that could harm others.

Business Judgment Rule

A legal principle that protects company directors from liability for decisions made in good faith and with a reasonable basis.