True or false? a. Most commercial bank loans are made under commitment. b. A line of credit

Question:

True or false?

a. Most commercial bank loans are made under commitment.

b. A line of credit provides the lender with a put option.

c. Bank term loans typically have a maturity of several years.

d. If the interest rate on a one-year bank loan is stated as a discount of 10%, the actual yield on the loan is less than 10%.

e. The interest rate on term loans is usually linked to LIBOR, the federal funds rate, or the bank’s prime rate.

Line of Credit
A line of credit (LOC) is a preset borrowing limit that can be used at any time. The borrower can take money out as needed until the limit is reached, and as money is repaid, it can be borrowed again in the case of an open line of credit. A LOC is... Maturity
Maturity is the date on which the life of a transaction or financial instrument ends, after which it must either be renewed, or it will cease to exist. The term is commonly used for deposits, foreign exchange spot, and forward transactions, interest...