The common stockholders have to bear maximum risk

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Reference no: EM131930330

1. A customer seeks a $150,000 home mortgage. The bank requires the customer to pay 2 1/4 points up front. How much of the loan amount will actually be available to the customer if the bank approves the loan?

$145,875

$148,125

$147,375

$146,625

None of the above

2. In which of the following combinations of capital structure do the common stockholders have to bear the maximum risk?

100 percent equity

100 percent debt

50 percent equity and 50 percent debt

25 percent equity and 75 percent debt

75 percent equity and 25 percent debt

Reference no: EM131930330

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