Asked by Austin Braun on May 03, 2024
Verified
A loan where the borrower pays interest each period and repays some or the entire principal of the loan over time is called an amortized loan.
Amortized Loan
An amortized loan is a loan where the principal is paid down over the life of the loan, typically through equal payments.
- Differentiate between loans that are amortized and others.
Verified Answer
KD
Kevin DurantMay 10, 2024
Final Answer :
True
Explanation :
An amortized loan is structured so that the borrower makes scheduled periodic payments that are applied to both principal and interest, gradually reducing the balance until it is paid off by the end of the term.
Learning Objectives
- Differentiate between loans that are amortized and others.
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