The amount of funds the borrower receives from the lender with a simple loan is called the
A) principal.
B) equity.
C) claim.
D) collateral.

Question

Quizplus · Accepted Answer

The principal is the amount of money that the lender provides to the borrower. It is the initial amount that the borrower receives and is required to repay, along with any interest or fees. Equity refers to the ownership in a property or asset, while claim refers to the legal right to specific assets or compensation. Collateral is something of value that is pledged as security for a loan, but it is not the same as the funds that the borrower receives.

The Amount of Funds the Borrower Receives from the Lender