Present Value of 1 Future Value of 1 Present Value of an Annuity of 1 Future Value of an Annuity of 1 Interest may be defined as:
A)Time.
B)A borrower's payment to the owner of an asset for its use.
C)The future value of a present amount.
D)Always a liability.
E)Always an asset.

Question

Present Value of 1  Future Value of 1  Present Value of an Annuity of 1  Future Value of an Annuity of 1  Interest may be defined as:
A)Time. 
B)A borrower's payment to the owner of an asset for its use. 
C)The future value of a present amount. 
D)Always a liability. 
E)Always an asset.

Quizplus · Accepted Answer

Interest is the borrower's payment to the owner of an asset for its use, such as the interest paid on a loan or the return earned on an investment. Time (option A) may be a factor in calculating interest, but it is not a definition of interest itself. Future value (option C) and present value (options A and D) are concepts related to interest, but they do not define interest itself. Option E is not a correct statement.