Interest costs for short-term debt are generally lower than interest costs for long-term debt becauseA. short-term debt is more flexible, allowing a match of short-term needs with short-term financing.B. the term structure of interest rates generally reflects an upward sloping yield curve.C. investors demand higher returns on short-term debt due to liquidity concerns.D. both A and B.

Companies and people use debt to tide over liquidity problems or to get access to funds to buy…

Interest costs for short-term debt are generally lower than interest costs for long-term debt because A. short-term debt is more flexible, allowing a match of short-term needs with short-term financing. OB. the term structure of interest rates generally reflects an upward sloping yield curve. O C. investors demand higher returns on short-term debt due to liquidity concerns. O D. both A and B.

Interest costs for short-term debt are generally lower than interest costs for long-term debt because A. short-term debt is more flexible, allowing a match of short-term needs with short-term financing. OB. the term structure of interest rates generally reflects an upward sloping yield curve. O C. investors demand higher returns on short-term debt due to liquidity concerns. O D. both A and B.

EBK CONTEMPORARY FINANCIAL MANAGEMENT

14th Edition

ISBN:9781337514835

Author:MOYER

Publisher:MOYER

Chapter16: Working Capital Policy And Short-term Financing

Section: Chapter Questions

Problem 8QTD

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