In each succeeding payment on an installment note:
A) The amount of interest paid increases.
B) The amount of principal paid increases.
C) The amount of principal paid decreases.
D) The amounts paid for both interest and principal increase proportionately.

Question

Quizplus · Accepted Answer

In an installment note, each succeeding payment generally includes more principal and less interest as the outstanding balance decreases. Therefore, the amount of principal paid increases with each payment while the amount of interest paid decreases.

In Each Succeeding Payment on an Installment Note