Continually rolling the interest on a loan over into the principal is called:
A) a budget surplus.
B) a Ponzi game.
C) the intertemporal approach.
D) macroeconomics.

Question

Quizplus · Accepted Answer

This practice is known as a Ponzi game, where the borrower pays interest or repays the principal on a loan by taking out more debt, rather than from their own income or other revenue sources.

Continually Rolling the Interest on a Loan Over into the Principal