A "revolver" is
A)a bond that is both callable and convertible.
B)debt with no effective maturity since it can be rolled over an infinite number of times at the request of the borrowing firm.
C)an open line of credit with a bank that requires the borrowing firm to pay a fee on any unused portion of the credit line.
D)an intermediate-term, zero-coupon bond.

Question

Quizplus · Accepted Answer

A revolver, or revolving credit, is an open line of credit with a bank that allows a borrowing firm to draw down, repay, and re-borrow funds. The firm pays a fee on any unused portion of the credit line, which incentivizes usage but also provides flexibility.

A "Revolver" Is