Which of the following statements concerning seasonal credit is TRUE?
A) It tends to have a lower interest rate than federal funds.
B) It has become increasingly more important in recent years.
C) Only firms receiving secondary credit are eligible to receive seasonal credit.
D) Improvements in credit markets have reduced the need for a seasonal credit facility.

Question

Quizplus · Accepted Answer

Improvements in credit markets have reduced the need for a seasonal credit facility, making option D the only true statement. Seasonal credit tends to have a higher interest rate than federal funds (not a lower rate as stated in option A). While seasonal credit remains important for certain industries (such as agriculture and tourism), it has not become increasingly more important in recent years (option B is false). Eligibility for seasonal credit does not depend on receiving secondary credit (option C is false).

Which of the Following Statements Concerning Seasonal Credit Is TRUE