Which of the following is not part of the cost of borrowing money?A.Cost of administering the loanB.Marketability of the loanC.Risk of defaultD.Length of the loanE.InflationSUBMITarrow_backPREVIOUS
Question
Which of the following is not part of the cost of borrowing money?A.Cost of administering the loanB.Marketability of the loanC.Risk of defaultD.Length of the loanE.InflationSUBMITarrow_backPREVIOUS
Solution
The option that is not part of the cost of borrowing money is B. Marketability of the loan. This is because the marketability of a loan refers to how easily a lender can sell the loan to another party, which does not directly impact the cost of borrowing for the borrower. The other options (A. Cost of administering the loan, C. Risk of default, D. Length of the loan, E. Inflation) all can impact the interest rate or fees that a borrower must pay, thus they are part of the cost of borrowing.
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