Question

Mezzinzi Bank offers loans to companies in the form of bonds. The companies who apply for these loans can repay the amount over a prolonged period of time. Which of the following financing options is being offered by Mezzinzi Bank in the given scenario?

A. A revolving credit agreement
B. Long-term debt
C. Commercial Paper
D. Trade credit

Answer 1

B) Long-term debt

Step-by-step explanation:

Long term debts are loans that are due in more than 1 year, and generally bonds are due in several years.

• Revolving credit agreements is a revolving line of credit where the client uses the funds only when they need it.
• Commercial papers are short term promissory notes (due in less than 1 year).
• Trade credit is usually handed out by a company's vendors where you receive merchandise and pay for it later (usually in a month or two).