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Financial Terms and U.S. Public Companies

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1. Define the following: term loan, balloon payment, collateral, and stock purchase warrants.

2. What fraction of U.S. public companies pays regular cash dividends today? How has this changed over the past 50 years?

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(1) Term loan: A loan from a bank for a specific amount that has a specified repayment schedule and a floating interest rate. Term loans almost always mature between one and 10 years. For example, many banks have term-loan programs that can offer small businesses the cash they need to operate from month to month. Often a small business will use the cash from a term loan to purchase fixed assets such as equipment used in its production process.

Balloon payment: The phrase balloon payment or bullet payment refers to ...

Solution Summary

This solution defines financial terms and discusses U.S. public companies that pay regular cash dividends.