ECONOMICS
SAVING AND INVESTING
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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Interest paid on both the principal and the already earned interest
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The interest paid on the principal alone
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A fixed charge for borrowing money; usually a percentage of the amount borrowed
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The money originally invested or loaned
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Detailed explanation-1: -The amount of money borrowed or invested is called as Principal. When you first take out a loan, the principal is the original amount you borrowed. As you pay toward that debt, the principal becomes the outstanding balance on the loan, not including interest and any fees accrued.
Detailed explanation-2: -Principal is also the original amount of investment made in an asset, separate from any earnings or interest accrued.
Detailed explanation-3: -Principal is the money that you originally agreed to pay back. Interest is the cost of borrowing the principal. Generally, any payment made on an auto loan will be applied first to any fees that are due (for example, late fees).
Detailed explanation-4: -The principal is the total amount borrowed from a lender or the initial amount invested. In other words, it is the original sum of money that has been borrowed or invested.
Detailed explanation-5: -The principal is the amount of funding borrowed for your home loan, and the interest is the money paid monthly for use of the loan. Understanding both principal and interest can help you choose the best mortgage option for you.