1. What is a cash discount? How is it calculated? Why would a company offer a cash discount?
2. What is net trade credit? How is it calculated? Why is it important?
3. What is a compensating balance? Why are they used? How can they be a benefit for the company borrowing money?
4. Describe the advantages and limitations of issuing commercial paper.
5. Describe and contrast pledging accounts receivable as collateral for a loan and factoring. Give examples of both.