Which one of the following terms is defined as a loan wherein the regular payments, including both interest and principal amounts, are insufficient to retire the entire loan amount, which then must be repaid in one lump sum? A. Amortized loan. B. Continuing loan. C. Balloon loan. D. Pure discount loan. E. Interest-only loan.

Business · High School · Mon Jan 18 2021

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The term that describes a loan where regular payments are insufficient to pay off the entire loan, requiring a lump sum payment at the end, is C. Balloon loan. In a balloon loan, the periodic payments typically cover only the interest or a portion of the principal, leaving a larger final "balloon" payment due at the end of the loan term to fully retire the remaining principal amount.

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