Using the _____ would be least expensive for the borrower when determining the total amount to be paid to the lender.
A)simple interest method
B)add-on interest method
C)discount method
D)sum-of-the-digits method
E)average loan balance method

Question

Using the _____ would be least expensive for the borrower when determining the total amount to be paid to the lender.
A)simple interest method
B)add-on interest method
C)discount method
D)sum-of-the-digits method
E)average loan balance method

Quizplus · Accepted Answer

The simple interest method is generally the least expensive for the borrower because it calculates interest based only on the principal amount of the loan, not on the accumulated interest.

Using the _____ Would Be Least Expensive for the Borrower When