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Questions and Answers
Which one of the following is a feature of a loan?
Which one of the following is a feature of a loan?
- Term
- Principal (correct)
- Payment
- Interest
What is the difference between a secured loan and an unsecured loan?
What is the difference between a secured loan and an unsecured loan?
- Secured loans have higher interest rates, while unsecured loans have lower interest rates.
- Secured loans do not require collateral, while unsecured loans require collateral.
- Secured loans require collateral, while unsecured loans do not require collateral.
- Secured loans have lower interest rates, while unsecured loans have higher interest rates. (correct)
What is the difference between a fixed rate and a variable rate?
What is the difference between a fixed rate and a variable rate?
- A fixed rate can change during the length of a loan, while a variable rate does not change during the length of the loan.
- A fixed rate is higher than a variable rate, while a variable rate is lower than a fixed rate.
- A fixed rate does not change during the length of a loan, while a variable rate can change during the length of the loan. (correct)
- A fixed rate is lower than a variable rate, while a variable rate is higher than a fixed rate.
Which one of these best describes the annual percentage rate (APR)?
Which one of these best describes the annual percentage rate (APR)?
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What does compound frequency refer to?
What does compound frequency refer to?
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What happens to the interest and principal portions of a monthly payment in an amortized loan?
What happens to the interest and principal portions of a monthly payment in an amortized loan?
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What is the loan/debt ratio guideline for monthly loan payments (not including mortgage)?
What is the loan/debt ratio guideline for monthly loan payments (not including mortgage)?
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