In 2008, Tim's Gyms needs to finance the building of a new gym. Suppose Tim secures this financing from a bank, and the bank receives ownership if Tim fails to make payments. This type of funding is
A) a stock issued in the bond market.
B) a mortgage obtained in the stock market.
C) a bond issued in the bond market.
D) a mortgage obtained in the loan market.

Question

Quizplus · Accepted Answer

The funding described in the scenario is a mortgage obtained in the loan market. This is because a mortgage is a type of loan that is secured by property or real estate, and in this case, the bank would receive ownership of the gym (the property) if Tim fails to make payments. The stock market and bond market involve investments that do not necessarily involve ownership of physical property.

In 2008, Tim's Gyms Needs to Finance the Building of a New