Multiple Choice
Which of the following is true regarding the present value of a loan?
A) The present value of a loan will equal the future value of all payments compounded at the effective loan rate.
B) The present value of a loan will equal the amount of borrowed money requested by the borrower.
C) The present value of a loan will equal the par value of the expected future cash flows, compounded at the prime rate.
D) The present value of a loan will always equal its expected future value at the end of the loan term.
Correct Answer:
Verified
Correct Answer:
Verified
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