Working Capital Management FIN3702, Assignment 1 Semester 2

8/20/24, 9:58 AM Assessment 1: Attempt review




UNISA  2024  FIN3702-24-S2  Welcome Message  Assessment 1

QUIZ




Started on Tuesday, 20 August 2024, 9:51 AM
State Finished
Completed on Tuesday, 20 August 2024, 9:58 AM
Time taken 6 mins 38 secs
Marks 20.00/20.00
Grade 100.00 out of 100.00


Question 1
Correct

Mark 1.00 out of 1.00




Which of the following is appropriate collateral for a loan secured under a floating
inventory lien?


1.
Cars



2.
Paper clips 



3. Drill presses

4. File cabinets




Your answer is correct.

The correct answer is:


Paper clips




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, 8/20/24, 9:58 AM Assessment 1: Attempt review

Question 2

Correct

Mark 1.00 out of 1.00




A firm has issued R2 million worth of commercial paper that has a 90-day maturity
and sells for R1 950 000. The approximate annual interest rate on the issue of
commercial paper is … (assume 365 days in a year).




1. 5%

2. 11% 

3. 21%

4. 23%




Your answer is correct.

The correct answer is:
11%




Question 3
Correct

Mark 1.00 out of 1.00




Lenders recognize that by having an interest in collateral they can reduce losses if
the borrowing firm defaults, …


1. and the presence of collateral reduces the risk of default.

2. but the presence of collateral has no impact on the risk of default. 

3. therefore, lenders prefer to lend to customers from whom they are able to
require collateral.

4. therefore, lenders will impose a higher interest rate on unsecured short-
term borrowing.




Your answer is correct.
The correct answer is:
but the presence of collateral has no impact on the risk of default.




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