Many firms that need funds borrow from financial institutions or individuals called: A. debtors. B. creditors. C. collateral. D. joint ventures. E. investors.
Question
Many firms that need funds borrow from financial institutions or individuals called: A. debtors. B. creditors. C. collateral. D. joint ventures. E. investors.
Solution
The correct answer is B. Creditors. Firms that need funds often borrow from financial institutions or individuals, who are known as creditors. These creditors lend money or capital to the firms with the expectation that they will receive their investment back along with any agreed-upon interest.
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