The primary source of secured short-term loans to businesses are
A) commercial banks and commercial finance companies.
B) savings and loans and factors.
C) commercial paper dealers and investment bankers.
D) life insurance companies and government securities brokers.

Question

Quizplus · Accepted Answer

Commercial banks and commercial finance companies are the primary sources of secured short-term loans to businesses. These institutions are well-equipped to assess the creditworthiness of a business and to offer loans with collateral, such as accounts receivable or inventory. Other options, such as savings and loans or factors, may also offer secured loans, but they are not as common as commercial banks and finance companies. Commercial paper dealers and investment bankers may offer short-term funding, but it is typically not secured by collateral. Life insurance companies and government securities brokers are not typically sources of short-term business loans.

The Primary Source of Secured Short-Term Loans to Businesses Are