To compute the effective cost of a revolving agreement, the joint effect of interest on borrowed funds and commitment fees must be considered.

Name: To compute the effective cost of a revolving agreement, the joint effect of interest on borrowed funds and commitment fees must be considered.
Brand: Quizplus
Rating: 4.7 (51 reviews)

Question

Quizplus · Accepted Answer

The statement is true. The effective cost of a revolving agreement takes into account both the interest on borrowed funds and any commitment fees paid to maintain the line of credit.

To Compute the Effective Cost of a Revolving Agreement, the Joint