A firm that can borrow from a bank any amount it wishes up to a certain limit, and at any time up to a certain date, is said to have a
A) repurchase agreement.
B) trade credit.
C) a line of credit.
D) internal financing.

Question

Quizplus · Accepted Answer

A line of credit is an agreement between a borrower and a bank or other financial institution where the borrower can draw funds up to a predetermined limit at any time. This is usually a flexible financing arrangement that allows businesses to access cash when needed without having to go through the application process every time.

A Firm That Can Borrow from a Bank Any Amount