Banks Are Most Apt to Quote Short-Term Loan Rates As

question 100

Multiple Choice

Banks are most apt to quote short-term loan rates as:

• A)prime plus a spread.
• B)prime plus inflation.
• C)prime minus inflation.
• D)Federal funds plus prime.
• E)prime minus the discount.

---

Definitions:

Collateral

Assets or property offered as security for a loan, to be forfeited in the event of default.

Perfected Purchase

A legal status in property law where the buyer obtains the rights to the property free from any prior claims or liens.

Money Security Interest

A legal claim or lien on collateral (such as cash or deposit accounts) provided by a debtor to secure a loan or other credit, ensuring the lender has a priority claim over the funds in the case of default.

Chattel Paper

A legal term referring to a document or electronic record that evidences both a monetary obligation and a security interest in a tangible good or a lease.