The ______ is the cost of borrowing or the price paid for the rental of funds expressed as a percentage per year. The chief financial officer (CFO) of a large corporation that wishes to borrow $100 million to construct a factory in the United States should use the ______ market. discount factor; goods discount factor; bond interest rate ; goods interest rate ; bond
Question
The ______ is the cost of borrowing or the price paid for the rental of funds expressed as a percentage per year. The chief financial officer (CFO) of a large corporation that wishes to borrow $100 million to construct a factory in the United States should use the ______ market. discount factor; goods discount factor; bond interest rate ; goods interest rate ; bond
Solution
The correct answer is "interest rate; bond". The first blank refers to the cost of borrowing or the price paid for the rental of funds, which is known as the interest rate. The second blank refers to the market that a CFO of a large corporation should use to borrow a large sum of money, which is the bond market. Therefore, the completed sentence is: "The interest rate is the cost of borrowing or the price paid for the rental of funds expressed as a percentage per year. The chief financial officer (CFO) of a large corporation that wishes to borrow $100 million to construct a factory in the United States should use the bond market."
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