A Company Wishes to Borrow $10,000 but to Efficiently Monitor

Multiple Choice

A company wishes to borrow $10,000 but to efficiently monitor that loan each lender will incur costs of $100.What is the difference in monitoring costs per lender (as a percentage of loan value) between the firm borrowing all the money from one lender and splitting the loan between ten lenders

A) 0%
B) 1%
C) 5%
D) 9%
E) 10%