True or false?

a. Most commercial bank loans are made under commitment.

b. A line of credit provides the lender with a put option.

c. Bank term loans typically have a maturity of several years.

d. If the interest rate on a one-year bank loan is stated as a discount of 10%, the actual yield on the loan is less than 10%.

e. The interest rate on term loans is usually linked to LIBOR, the federal funds rate, or the bank’s prime rate.

AppendixLO1