Which of the Following Statements About Commercial Lending Is Incorrect

question 14

Multiple Choice

Which of the following statements about commercial lending is incorrect?

• A) The term loan is the main type of lending provided by banks to firms.
• B) Typically, term loans are for maturities ranging from 5 to 15 years.
• C) To extend commercial bill financing a bank may provide the firm with a rollover facility.
• D) Banks can provide flexible funding called an overdraft to firms.

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Definitions:

Standard Normal

A normal distribution with a mean of zero and a standard deviation of one, commonly used in statistical analyses.

Mean

The arithmetic average of a set of values or measurements, calculated by summing them all up and dividing by the number of values.

Standard Deviation

A statistic that measures the dispersion or variability of a set of data points relative to its mean.

Normal Distribution

A bell-shaped frequency distribution curve where most of the occurrences take place near the mean and fewer and fewer occur as one moves away from the mean.