Limits Set on the Maximum Loan Size That Can Be

question 26

Multiple Choice

Limits set on the maximum loan size that can be made to an individual borrower are referred to as:

• A)maximum damage limits.
• B)concentration limits.
• C)syndication limits.
• D)minimisation limits.

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Definitions:

Equity Multiplier

A financial ratio indicating the proportion of a company's assets that are financed by stockholders’ equity, showing the level of financial leverage.

Earnings Per Share

A company's net profit divided by the number of its outstanding shares, indicating the profitability per share.

Price-Earnings Ratio

A financial metric used to evaluate a company's share price relative to its earnings per share, helping investors assess the market value of a stock.

Times Interest Earned

is a financial ratio that compares a company's income before interest and taxes (EBIT) to its interest expenses, indicating how well the company can cover its interest obligations.