44. In order to carry-out the operation referred to above, Paul now tells you that he will need to raise capital. He doesnt mind that Plastis borrows the money and thinks that interest rates currently employed by banks to fund this type of operations are quite appealing, however, believes his business will only be able to start repaying the amount borrowed after a couple of years. Additionally, he would prefer a set repayment schedule, where Plastis would repay a set equal amount each month. He asks again for your advice, how should Plastis raise capital? A) Through a revolving credit facility. B) Through a term loan with a bullet repayment schedule. C) Through an overdraft. D) Through a term loan with an amortization repayment schedule.

45. After hearing your advice, Paul wishes, nevertheless, to provide Plastis with a shareholder loan. He asks you what are the possible disadvantages, for Paul, in doing so. One disadvantage is: A) He would lose part of his ownership of the company. B) In case of bankruptcy, shareholder loans are subordinated claims, meaning that they are ranked last in the list of credits. C) A shareholder loan would not be sufficient to cover the amount of capital Plastis needs to raise. D) This would leave the company vulnerable to a hostile takeover.

46. Paul was convinced by your argument and therefore decides to request a bank loan in the terms suggested. The bank has said that it will only provide such loan if Paul or Plastis provide security. Paul does not wish to provide any personal security and thinks that the bank would be happy with some form of security interest over the building where Plastis main factory operates. He obviously only wants to grant the bank the minimum security necessary. What would be a suitable suggestion? A) Provide a mortgage over the building. B) Provide a pledge over the building, since in this case there would be tax benefits for both sides. C) Provide a pledge over Plastis shares. D) Paul provides a guarantee with prior excussion.

47. What is the difference between a partnership and company? A) There can be more partners in a partnership than shareholders in a company. B) A partnerships structure is less flexible than a companys structure. C) A partnership is more suitable for international investors than a company. D) None of the above.

48. What is the decisive influence test, used to determine the presence of a single economic unit? A) If a group of companies acts with one unitary purpose, they are deemed to be a single economic unit. B) If the parent can and actually exercises decisive influence on the subsidiary, they are deemed to be a single economic unit. C) If the parent acts as a representative of the subsidiary, they are deemed to be a single economic unit. D) If a group of companies act concertedly, they are deemed to be a single economic unit