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Why Will Banks Extend Short-Term Working Capital Financing to Companies

Question 170

Multiple Choice

Why will banks extend short-term working capital financing to companies to which they would not extend long-term credit?


A) Conditions are unlikely to deteriorate too badly in the short term.
B) Working capital loans are "self-liquidating."
C) The working capital itself can be used to collateralize the loan.
D) All of the above

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