Asked by Tingting Cheung on Jul 04, 2024
Verified
Interest represents a cost to the borrower, but an income to the lender.
Interest
The cost of borrowing money or the return earned on investments, typically expressed as a percentage.
Borrower
An individual, corporation, or other entity that receives funds from another party under the condition of returning the funds plus interest or other charges at a later date.
Lender
A financial institution or individual that provides funds to a borrower under the condition that the funds will be repaid with interest.
- Understand the fundamental concepts of loan interest, including elements that influence interest rates and the connection between the amount of the loan and its duration.
Verified Answer
ZK
Zybrea KnightJul 07, 2024
Final Answer :
True
Explanation :
Interest is the charge for the privilege of borrowing money, typically expressed as an annual percentage rate. It is a cost to the borrower who has to pay it on top of the principal amount borrowed, but it is an income to the lender who receives it as a return on their loaned capital.
Learning Objectives
- Understand the fundamental concepts of loan interest, including elements that influence interest rates and the connection between the amount of the loan and its duration.