Charlie Chicken Restaurants Announced It Plans to Issue $300 Million

question 64

Multiple Choice

Charlie Chicken Restaurants announced it plans to issue $300 million in debenture bonds to fund the expansion of its fast food chain of restaurants. In financial terms, this means

• A) the corporation will borrow $300 million worth of long-term financing. The bond issue will not carry any collateral.
• B) the corporation will issue $300 million worth of equity financing. The bond issue will be backed by the property and buildings purchased with the funds.
• C) the corporation will borrow $300 million worth of long-term financing. The issue will be backed by the property and buildings purchased with the funds.
• D) the corporation will issue $300 million worth of interest-free bonds. Financiers will be paid from the revenues created by the individual franchises.

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Definitions:

Process Focus

A manufacturing plant structured based on processes to support the creation of small quantities of diverse products.

Mass-customization

A production strategy that combines the flexibility and personalization of custom-made products with the low unit costs of mass production.

Flexibility

The ability to respond with little penalty in time, cost, or customer value.

Repetitive Focus

A production strategy that emphasizes the continuous output of a single or few products, often using assembly line methods for efficiency.