Instruction 9.1: For the Following Problem(s), Consider These Debt Strategies Being Considered

question 43

Multiple Choice

Instruction 9.1:
For the following problem(s) , consider these debt strategies being considered by a corporate borrower. Each is intended to provide $1,000,000 in financing for a three-year period.
-Strategy #1: Borrow $1,000,000 for three years at a fixed rate of interest of 7%.
-Strategy #2: Borrow $1,000,000 for three years at a floating rate of LIBOR + 2%, to be reset annually. The current LIBOR rate is 3.50%
-Strategy #3: Borrow $1,000,000 for one year at a fixed rate, and then renew the credit annually. The current one-year rate is 5%.
-Refer to Instruction 9.1. Which strategy (strategies) will eliminate credit risk?

• A)Strategy #1
• B)Strategy #2
• C)Strategy #3
• D)Strategy #1 and #2

Understand the significance of high-performance teams turning general purposes into specific performance objectives.

Comprehend the importance of core values and the right mix of skills in high-performance teams.

Acknowledge the process of team building including its steps and challenges involved.

Understand the concepts of norms, inter-team dynamics, and the impact of cohesiveness on team performance.

---

Definitions:

Mass

An assessment of the quantity of substance contained within an object, usually expressed in kilograms or grams.

Chemical

A substance produced by or used in a chemical process, including elements and compounds.

Density

A measure of how much mass is contained in a given unit volume of a substance.

Volume

The size of the space covered by an object or a substance.