Gce Model Questions Vol1 2025 Commerce Question 47
Practice objective / multiple choice question 47 from the 2025 Gce Model Questions Vol1 Commerce examination.
A firm needs ₦(5{,}000{,}000\) for expansion. It can obtain a bank loan at 12% p.a. payable annually with a one‑time arrangement fee of 2% of the loan amount. Alternatively, it can issue 10‑year debentures at 9% p.a. but must pay underwriting charges of 3% of the issue amount and a registration fee of ₦(50{,}000\). Assuming the finance is held for exactly 5 years and ignoring tax, which source costs less over the 5‑year period and by how much?
Answer Options
About This Question
This is Gce Model Questions Vol1 2025 Commerce Question 47. It is one of the objective questions from the 2025 Gce Model Questions Vol1 Commerce examination.
Difficulty level: Medium .
Master the Exam!
You've seen a preview, but there are thousands more questions plus AI tutor to break down complex solutions.