easy · Corporate Credit Analysis

In the context of 'Lien' priority, what is a 'Purchase Money Security Interest' (PMSI)?

1. A lien on a specific asset that gives the lender priority if they provided the funds to buy that asset.
2. The right of the company to buy back its bonds at a 50% discount in the market.
3. A penalty fee paid to lenders when a company is purchased by a competitor.
4. A guarantee provided by a bank to ensure trade suppliers are paid on time.

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