QUESTION 9 The interest rate charged on secured short-term loans to a corporation is generally higher than that charged on unsecured short-term loans because ... the risk of default is lower on...

QUESTION 9

The interest rate charged on secured short-term loans to a corporation is generally higher than that charged on unsecured short-term loans because ...

1. 
   

   the risk of default is lower on secured loans.

   
   


2. 
   

   secured loans are less risky than unsecured loans.

   
   


3. 
   

   it is costly to negotiate and administer secured loans.

   
   


4. 
   

   lenders of secured loans must pay more for their funds.