Use the Following Information to Answer the Question(s)below

question 92

Multiple Choice

Use the following information to answer the question(s) below. The risk-free rate of interest is 3% and the market risk premium is 5%.
-The value of the gas and convenience store division is closest to:

• A)$4500
• B)$6000
• C)$8600
• D)$15,000

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Definitions:

Promissory Note

A lending agreement in which the borrower promises to pay principal and interest in accordance with specific terms.

Commercial Banks

Banks that provide a wide range of services to businesses and consumers including loans, checking accounts, and savings options.

Commercial Bank Loans

are loans that businesses and individuals can obtain from a commercial bank to finance various needs, such as business expansion or personal expenses.

Short-Term Financing

Refers to borrowing funds for a period of less than one year to meet immediate financial requirements.