Which One of These Situations Creates Negative Amortization

question 64

Multiple Choice

Which one of these situations creates negative amortization?

• A)increasing the amount of the monthly mortgage payment
• B)paying less than the monthly interest on a mortgage
• C)decreasing the amount paid into an escrow account
• D)lowering the mortgage interest rate
• E)decreasing the amount of the down payment

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Definitions:

Standard Deviation

A measure of the dispersion or variability within a set of numerical data, indicating how much individual data points differ from the mean.

Mean

The mean of a set of numbers obtained by summing them up and then dividing by the total number of values.

Normally Distributed

Refers to data that fall in a bell curve pattern centered around the mean, used to describe a distribution in statistics.

Standard Deviation

A measure of the amount of variation or dispersion of a set of values, indicating how much the values deviate from the mean of the set.