2
QuizMultiple Choice

Credit and Types of Loans — Test

Question 2 • Financial Math

How might paying with cash benefit Antonio’s business in terms of financial flexibility?

Answer
A
requires renegotiation of payment terms annually
B
increases the complexity of financial reporting
C
complicates the monthly budget due to high upfront costs
D
frees up monthly cash flow by avoiding loan payments

Explanation

Paying with cash avoids taking out a loan, so Antonio’s business won’t have regular loan payments to make each month. That leaves more monthly cash available for other expenses or opportunities. The correct choice is “frees up monthly cash flow by avoiding loan payments.”

AI-written and checked against the verified answer.

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