BUISENESS MANAGEMENT
FINANCIAL MANAGEMENT
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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It is an arrangement in which you buy now and pay later.
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It is the annual rate of interest a bank charges for a loan.
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It is the original amount of money the bank loans the borrower.
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None of the above
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Detailed explanation-1: -Principal: The original amount of the loan or the money borrowed. Interest: A percentage of the principal the lender charges the borrower. This money must be paid along with the original amount borrowed. Term: The length of time it will take for a borrower to repay the original principal and interest completely.
Detailed explanation-2: -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-3: -Principal is most commonly used to refer to the original sum of money borrowed in a loan or put into an investment. It can also refer to the face value of a bond, the owner of a private company, or the chief participant in a transaction.
Detailed explanation-4: -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.
Detailed explanation-5: -The amount owed is called the principal and the price of borrowing money is called interest.