The Amount of Interest Owed on a Loan of $100,000

question 107

Multiple Choice

The amount of interest owed on a loan of $100,000 after a year at an interest rate of 3 percent is:

• A) $3,000.
• B) $30,000.
• C) $103,000.
• D) $100,300.

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Definitions:

Producer Surplus

The difference between the amount producers are willing and able to supply a good for and the actual amount received by them when the good is sold.

Consumer Surplus

The variance between the price consumers are ready to offer for a good or service and the price they actually incur.

Price Ceiling

A government-imposed limit on how high the price of a product can be charged in the market to protect consumers from high prices.

Consumer Surplus

The gap between the amount consumers are prepared to spend on a product or service and the amount they end up paying.