When evaluating the incremental costs of borrowing,if the interest rate is higher on the larger loan amount,the incremental cost of the additional funds borrowed tends to be lower than the rate on the larger loan.

Question

Quizplus · Accepted Answer

The incremental cost of the additional funds borrowed tends to be higher, not lower, when the interest rate is higher on the larger loan amount, as it reflects the additional risk or cost associated with lending more money.

When Evaluating the Incremental Costs of Borrowing,if the Interest Rate