Use the Following Information for Questions

question 4

Multiple Choice

Use the following information for questions
A bank customer is granted credit for a $2,000 loan at 10% to be repaid in 12 equal installments.
-If the loan is a discount loan, what is the monthly payment?

• A) $200.00
• B) $192.35
• C) $184.20
• D) $173.12
• E) $166.67

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Definitions:

Inventory Investment

The change in the stock of unsold goods and materials held by a business over a period of time, affecting the overall investment levels in the economy.

Level of Inventory

The quantity of goods that a company has in stock at a specific time.

Borrowing Money

The act of receiving funds from a lender under the agreement to repay the principal amount along with interest or fees over a defined period.

Interest Rate

The percentage of a sum of money charged for its use, often noted annually, on loans or earned on deposits.