The Primary Purpose of the Truth-In-Lending Act Is to

question 11

Multiple Choice

The primary purpose of the Truth-in-Lending Act is to

• A) require full disclosure of the amount of the promissory note
• B) provide meaningful information to borrowers on the cost of consumer credit
• C) discourage excessive loan costs for consumers
• D) establish limits on the total charges a lender can assess for a loan

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Definitions:

Variable Cost

Expenses that change in proportion to the activity of a business.

Net Present Value

The calculation of the present value of an investment's expected earnings, minus the initial capital outlay.

Net 30 Credit Policy

A payment term that allows a buyer 30 days to pay the invoice in full from the invoice date.

Monthly Interest Rate

The interest rate charged on a loan or realized on an investment over a one-month period.