When a borrower receives the face amount of a discounted note less interest, this amount is known as:
A) the note proceeds
B) the note discount
C) the note deferred interest
D) the note principal

Question

Quizplus · Accepted Answer

The face amount of a discounted note less interest is known as the note proceeds. This represents the actual amount the borrower receives from the lender. The note discount refers to the difference between the face value of the note and the actual amount received, while deferred interest is interest that is not paid right away but is instead added to the principal balance of the loan. The note principal represents the original amount borrowed.

When a Borrower Receives the Face Amount of a Discounted