To ensure repayment, bank loans are based on the Blank______.Multiple choice question.number of shareholders or equity partnersassets or the cash flow of the ventureworking capitalnumber of employees
Question
To ensure repayment, bank loans are based on the Blank______.Multiple choice question.number of shareholders or equity partnersassets or the cash flow of the ventureworking capitalnumber of employees
Solution
The correct answer is "assets or the cash flow of the venture". Banks need to ensure that the borrower has the ability to repay the loan, and this is typically determined by assessing the borrower's assets or cash flow. This provides the bank with a measure of the borrower's financial stability and ability to generate income to repay the loan.
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