Abby is wanting to obtain a loan for a large oven for her bakery. Since the oven will last approximately 8 years, the ideal loan would be a _____ loan.

Question

Quizplus · Accepted Answer

A term loan is a loan that has a fixed repayment schedule and matures at a set date in the future. This type of loan is ideal for Abby's situation since she knows exactly how long she will need the oven and can plan her repayments accordingly. A mortgage loan is typically used for real estate purchases, trade credit is typically used for short-term transactions between businesses, and an asset-based loan is secured by the borrower's assets, which may not be applicable in Abby's situation.

Abby Is Wanting to Obtain a Loan for a Large