Sly's Just Arranged a 3-Year Direct Business Loan

question 42

Multiple Choice

Sly's just arranged a 3-year direct business loan. Which one of the following terms matches this loan arrangement?

• A) Term loan
• B) Private placement
• C) Rights offer
• D) Seasoned offer
• E) Shelf offer

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Definitions:

Equity Method

The Equity Method is an accounting technique used by companies to assess the profits earned by their investments in other companies, recognizing income based on the proportionate share of the investee's net income.

Voting Shares

Shares of a company's stock that give the shareholder the right to vote on matters such as the election of directors and other important issues.

Significant Influence

A level of control in an investment, generally considered to be an ownership interest of 20%–50%, that allows the investor to have a notable impact on the investee's decisions.

Declared Dividends

Dividends announced by a company's board of directors to be paid to shareholders, often as a share of the company's earnings.