If You Wish to Keep Your Monthly Payments as Low

question 118

Multiple Choice

If you wish to keep your monthly payments as low and predictable as you can, you should use a

• A) 15-year ARM.
• B) 30-year ARM.
• C) 15-year fixed rate.
• D) 30-year fixed rate.

---

Definitions:

Accelerated Depreciation

A depreciation method that allows for a higher depreciation charge in the early years of an asset's life and less in the later years.

Depreciable Assets

Assets subject to depreciation, reflecting the reduction in value due to wear and tear, decay, or decline in usefulness over time.

Cash Flow

The net amount of cash being transferred into and out of a business, which is used to maintain the company's operations.

Operating Activities

Business actions directly related to its day-to-day operations, such as selling products or services, which generate revenue and expenses.