The Return That Lenders Require on Their Loaned Funds to the Firm

question 65

Multiple Choice

The return that lenders require on their loaned funds to the firm is called the:

• A) coupon rate.
• B) current yield.
• C) cost of debt.
• D) capital gains yield.
• E) cost of capital.

---

Definitions:

Credit Entry

An accounting entry that increases a liability or equity account or decreases an asset or expense account.

Service Revenue

Income earned by a company for services provided to customers or clients.

Credit Side

Refers to the right side of a ledger account and is where increases in liabilities, equity, and revenue are recorded.

Total Liabilities

The total amount of obligations owed by a company to third parties, including loans, accounts payable, mortgages, and other debts.