Question

What is the primary difference between a general operating line of credit and a permanent working capital line of credit?

		General operating lines of credit frequently have a substantial principal balance
		Permanent working capital lines of credit frequently have a substantial principal balance outstanding
		Permanent working capital lines of credit generally are closed-end or non-revolving
		General operating lines of credit usually fund rapidly growing businesses

Answer 1

Option C. Permanent working capital lines of credit generally are closed-end or non-revolving.

General operating line of credit is a type of revolving account. This arrangement allows borrowers to spend the money, repay it and spend it again in a virtually never-ending, revolving cycle.