Agro Co-op, Inc. ,and Bio Feed Corporation are exporting firms that join together to export a line of products. Agro Co-op and Bio Feed apply to Charter Bank for a loan to fund their effort. Under federal law, Charter and other U. S.banks are:A) encouraged by credit guaranties to lend such funds. B) discouraged by administrative rules to make such loans. C) asked by enforcement agencies to report such requests. D) banned by statute from opening such credit lines.

A) encouraged by credit guaranties to lend such funds

Explanation:

In a situation like this, under the United States export financing options, (International Trade Administration) for firms who are into exportation of American products, Banks are highly encouraged by credit guarantees to lend funds for the interested firms. This process is also boosted through working capital guarantees from Ex-Im Bank or the U.S. Small Business Administration. 

Hence, Charter and other U.S.banks are: "encouraged by credit guarantees to lend such funds."

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