What Is the Difference Between Federal Subsidized and Unsubsidized Loans

question 18

Multiple Choice

What is the difference between federal subsidized and unsubsidized loans?

• A) Subsidized loans do not require repayment until 12 months after graduation,whereas unsubsidized loans require repayment immediately upon graduation
• B) With a subsidized loan,the interest on the loan is paid by the government if the student is enrolled in school at half-time status or greater; an unsubsidized loan requires the student to pay the interest on the loan that has accrued while still in school
• C) An unsubsidized loan allows students to borrow a greater amount of money than subsidized loans
• D) All of these

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Definitions:

Productive Capacity

The maximum output that an economy can produce without increasing inflation, given its current level of resources.

Equity

Fairness or justice in the way people are treated or the distribution of resources, often distinguished from equality by focusing on needs and outcomes.

Efficiency

The optimal use of resources to achieve the best possible outcome or output without wasting resources.

Market Economy

An economic system in which supply and demand determine the production of goods and services.