Given 10 and 30 year loans with the same interest rate, the 30 year loan results in a lower periodic payment.
A)True
B)False

Question

Quizplus · Accepted Answer

The periodic payment for a loan is based on the loan amount, interest rate, and loan term (number of years). With a longer loan term, the payments are stretched out over more years, resulting in smaller periodic payments. Therefore, the 30 year loan will result in a lower periodic payment compared to a 10 year loan with the same interest rate.

Given 10 and 30 Year Loans with the Same Interest