What decision does the board make about loans from the cooperative?

Answer Details

The board decides that staff loans from the cooperative cannot exceed N250,000. This cap is introduced as a safeguard after the board discovers the cooperative's large fund and the risks associated with unlimited lending. By setting a maximum loan amount, the board aims to prevent any single staff member from taking on an excessively large debt that they might fail to repay, as happened with Mr. Nku's N2 million loan.

In addition to the loan cap, the board also requires that all loan requests be approved by the MD and that management be informed about the cooperative's elections. These measures collectively tighten oversight of the cooperative's operations and reduce the financial risk to both the school and its staff members.

The other options do not accurately reflect the board's decision. The board did not ban loans entirely, nor did it require staff union approval for loans, nor did it order the cooperative to stop lending immediately. The approach was to impose a reasonable limit of N250,000 rather than to shut down the cooperative's lending function altogether.