Genetech Has $4,000,000 in Assets, Have Decided to Finance 30

question 119

Multiple Choice

Genetech has $4,000,000 in assets, have decided to finance 30% with long-term financing (9% rate) and 70% with short-term financing (7%) rate. What will be their annual interest costs?

• A) $78,000
• B) $126,000
• C) $440,000
• D) $304,000

Identify appropriate genera and differentia for constructing definitions.

Distinguish between literal and metaphorical definitions.

Recognize the role of abstraction level in selecting a genus for definitions.

Identify examples of stipulative definitions and understand their purpose.

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Definitions:

Guarantee

An assurance or formal promise that specific conditions will be fulfilled, often related to the quality, durability, or functionality of a product or service.

Overallotment Provisions

Options in securities underwriting that allow underwriters to sell more shares than initially planned, useful in managing demand and stabilizing the market price post-listing.

Implicit Call Option

A provision in a financial contract that gives the issuer the right, but not the obligation, to take a specified action under certain conditions, often found in bonds.

Include

To contain, encompass, or have something as part of a whole or group.