When Creditors Provide Funds to a Firm, Which of the Following

question 17

Multiple Choice

When creditors provide funds to a firm, which of the following is/are true?

• A)The firm must repay, usually with interest, in specific amounts at specific dates.
• B)Long-term creditors require repayment from the borrower over a period of time that exceeds one year.
• C)One common form of long-term financing is bonds.
• D)Suppliers of raw materials or merchandise that do not require payment for 30 days provide short-term funds.
• E)All of the above are true.

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Definitions:

Triple Bond

A chemical bond in which three pairs of electrons are shared between two atoms, making it stronger and shorter than single and double bonds.

Molecular Formula

A notation that shows the type and number of atoms in a molecule but not their structural arrangement.

1-Hexyne

A colorless, flammable liquid hydrocarbon with a triple bond in its structure, part of the alkyne group, used in organic synthesis.

Condensed Structural Formula

A method of describing the elements or molecules that comprise a compound and the way in which they are bonded to each other, using lines for bonds and showing minimal detail.