If your company needs a large amount of money and must have a long-ter

QUESTION

If your company needs a large amount of money and must have a long-term note but is unable to obtain a long-term loan, what might be the next best thing for it?

A) to obtain a short-term loan
B) to obtain a revolving credit agreement
C) to obtain a line of credit
D) to issue corporate bonds
E) to obtain commercial paper

ANSWER

Answer: D
Explanation: D) If a company is unable to obtain a long-term loan, it may try to issue corporate bonds, contracts between issuer and buyer in which the purchase price represents a loan by the buyer and for which the issuing firm pays the buyer interest.