A prearranged credit agreement with a bank typically open for two or more years is called a

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A prearranged credit agreement with a bank typically open for two or more years is typically known as a revolving credit arrangement. This type of credit allows businesses to borrow up to a pre-approved credit limit for a certain period, typically two to three years, and repay the debt as well as interest on the outstanding balance. The available credit limit replenishes as the business repays the borrowed amount, creating a revolving credit line.

A Prearranged Credit Agreement with a Bank Typically Open for Two