Which of These Is the Fee Charged by a Bank

question 69

Multiple Choice

Which of these is the fee charged by a bank for making funds available through a loan commitment?

• A) Back-end (or commitment) fee
• B) Simple interest expense
• C) Discounted interest
• D) Up-front (or facility) fees

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Definitions:

Goodwill

An intangible asset that arises when a buyer acquires an existing business, representing the value of the business's brand, customer base, and other non-physical assets.

Land Improvements

Upgrades made to land such as landscaping, irrigation systems, and construction of pathways that enhance its value and utility.

Buildings

Structures constructed on land that serve various purposes, such as commercial, residential, or industrial activities, often considered as long-term assets in financial accounting.

Land

A natural resource concerning the solid surface of the earth, which is not subject to depreciation.