Compensating balances represent unfair hidden costs

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Reference no: EM131497357

1) Small companies finance a relatively greater proportion of their assets through trade credit than do larger firms.

TRUE OR FLASE

2) Accounts payable is a spontaneous source of funds that usually grows as the business expands.

TRUE OR FALSE

3) Compensating balances represent unfair hidden costs of borrowing.

TRUE OR FALSE

5) Small businesses frequently find commercial paper a useful means of obtaining funds when it is not possible to raise funds by other means.

TRUE OR FALSE

6) Issuers of commercial paper can be divided into finance paper or direct paper, dealer paper, and asset-backed commercial paper.

TRUE OR FALSE

7) Firms using commercial paper are generally required to maintain commercial bank lines of credit equal to the amount of the paper outstanding.

TRUE OR FALSE

Reference no: EM131497357

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