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How do banks attempt to reduce the problem of asymmetric information when analyzing an application for a loan? Visit the company, visually verify it is
How do banks attempt to reduce the problem of asymmetric information when analyzing an application for a loan? Visit the company, visually verify it is in operation, and that it has the inventory reported on its balance sheet. Secure the loan with company collateral. Require a personal guaranty from the company owners Require the borrower to have a minimum percentage of their own money invested in the company. All of the above
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