Which of the Following Statements Concerning a 30 Year,$150,000 Loan

question 8

Multiple Choice

Which of the following statements concerning a 30 year,$150,000 loan at 7% with monthly payments is true,if 15 years later,an investor wants to purchase the loan and market interest rates are 5%?

• A)The market value of the loan is higher than the book value of the loan because the market rate of interest is lower than the interest rate on the loan
• B)The market value of the loan is lower than the book value of the loan because the market rate of interest is lower than the interest rate on the loan
• C)The market value of the loan is higher than the book value of the loan because the market rate of interest is higher than the interest rate on the loan
• D)The market value of the loan is lower than the book value of the loan because the market rate of interest is higher than the interest rate on the loan

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Definitions:

Adrenal Glands

Endocrine glands located above the kidneys, responsible for producing hormones like adrenaline and cortisol, involved in stress response.

Nerve Network

A system of interconnected nerve cells (neurons) that work together to process and transmit information in the body.

Depolarization

A reduction of the difference in charge between the inside and outside of the cell membrane, typically in a neuron, leading to the generation of an action potential.

Selectively Permeable

Describes biological membranes that allow certain substances to pass through while blocking others, thereby controlling the exchange of materials.