Which facility provides access to funds up to a pre-approved limit and requires repayment with interest?

Which facility provides access to funds up to a pre-approved limit and requires repayment with interest?

• A. Income
• B. Line Of Credit
• C. Primary Market
• D. Income Tax

Answer: (B)

A line of credit is a flexible financing facility that provides access to funds up to a pre-approved limit. You can draw money as needed, repay, and then borrow again, with interest charged only on the amount you borrow. This revolving feature and the pre-set credit limit are what make it the best fit for the description. Income is money earned, not a borrowing facility. The primary market relates to issuing new securities, not borrowing from a lender. Income tax is a levy on earnings, not a credit line.

A line of credit is a flexible financing facility that provides access to funds up to a pre-approved limit. You can draw money as needed, repay, and then borrow again, with interest charged only on the amount you borrow. This revolving feature and the pre-set credit limit are what make it the best fit for the description.

Income is money earned, not a borrowing facility. The primary market relates to issuing new securities, not borrowing from a lender. Income tax is a levy on earnings, not a credit line.