A loan that is repaid in equal payments over a specified time period is referred to as a(n):
A) discounted loan
B) amortized loan
C) simple interest-free loan
D) inflation-indexed loan

Question

Quizplus · Accepted Answer

An amortized loan is a loan that is repaid in equal payments over a specified time period. The payments are structured so that a portion of each payment goes towards interest and a portion goes towards paying down the principal balance. This means that the loan will gradually be paid off over time, with each payment bringing the borrower closer to being debt-free. Discounted loans, simple interest-free loans, and inflation-indexed loans all have different repayment structures and are not structured in the same way as amortized loans.

A Loan That Is Repaid in Equal Payments Over a Specified