When the lender provides the borrower with an amount of funds that must be repaid to the lender at the maturity date,along with an additional payment for the interest,it is called a ________.
A) fixed-payment loan
B) discount loan
C) simple loan
D) none of the above

Question

Quizplus · Accepted Answer

This is the definition of a simple loan, where the borrower receives a lump sum of funds that must be repaid with interest at the maturity date. A fixed-payment loan typically has the same payment amount each period and includes both principal and interest, and a discount loan involves the lender discounting the principal upfront and the borrower repays the full principal amount at maturity.

When the Lender Provides the Borrower with an Amount of Funds