Installment Loans Using the Simple Interest Method

question 124

Multiple Choice

Installment loans using the simple interest method

• A)have the highest finance charges of any method.
• B)have interest charged only on the monthly loan balance.
• C)do not have balloon payments.
• D)have a lower APR than the stated interest rate.
• E)have a higher APR than the stated interest rate.

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Definitions:

Partnership

A lawful business structure involving two or more people who divide both management responsibilities and earnings.

Payments

The action or process of paying someone or something, typically involving transferring money in exchange for goods or services.

Big Bank

A colloquial term often used to describe very large multinational banking and financial services corporations.

Capital Contribution

The act of injecting financial resources or assets into a company or partnership by its owners or partners.