The Rule of 78s dictates that a borrower pays:
A)more interest at the beginning of the loan period.
B)more interest at the end of the loan period.
C)more interest in the middle of the loan period.
D)less interest than indicated by the APR.
E)equal amounts of interest throughout the loan.

Question

Quizplus · Accepted Answer

The Rule of 78s is a method used in some types of loans where interest payments are front-loaded, meaning the borrower pays more interest at the beginning of the loan period.

The Rule of 78s Dictates That a Borrower Pays