Carly wants to buy and operate an ice-cream truckbut doesn’t have the financial resources to start thebusiness. She borrows $20,000 from her friendFreddie, to whom she promises an interest rateof 7 percent, and gets another $30,000 from herfriend Sam, to whom she promises a third of herprofits. What best describes this situation?a. Freddie is a stockholder, and Carly is abondholder.b. Freddie is a stockholder, and Sam is abondholder.c. Sam is a stockholder, and Carly is a bondholder.d. Sam is a stockholder, and Freddie is abondholder.
Carly wants to buy and operate an ice-cream truckbut doesn’t have the financial resources to start thebusiness. She borrows $20,000 from her friendFreddie, to whom she promises an interest rateof 7 percent, and gets another $30,000 from herfriend Sam, to whom she promises a third of herprofits. What best describes this situation?a. Freddie is a stockholder, and Carly is abondholder.b. Freddie is a stockholder, and Sam is abondholder.c. Sam is a stockholder, and Carly is a bondholder.d. Sam is a stockholder, and Freddie is abondholder.
Essentials of Economics (MindTap Course List)
8th Edition
ISBN:9781337091992
Author:N. Gregory Mankiw
Publisher:N. Gregory Mankiw
Chapter19: The Basic Tools Of Finance
Section: Chapter Questions
Problem 2PA
Related questions
Question
Carly wants to buy and operate an ice-cream truck
but doesn’t have the financial resources to start the
business. She borrows $20,000 from her friend
Freddie, to whom she promises an interest rate
of 7 percent, and gets another $30,000 from her
friend Sam, to whom she promises a third of her
profits. What best describes this situation?
a. Freddie is a stockholder, and Carly is a
bondholder.
b. Freddie is a stockholder, and Sam is a
bondholder.
c. Sam is a stockholder, and Carly is a bondholder.
d. Sam is a stockholder, and Freddie is a
bondholder.
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