Over the life of a fixed payment amortized loan, such as a conventional mortgage, the proportion of the payment that goes to repay principal A : increases each month. B : varies with economic conditions. C : decreases each month. D : stays constant over time.
Over the life of a fixed payment amortized loan, such as a conventional mortgage, the proportion of the payment that goes to repay principal A : increases each month. B : varies with economic conditions. C : decreases each month. D : stays constant over time.
Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
Section: Chapter Questions
Problem 1PS
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Concept explainers
Mortgages
A mortgage is a formal agreement in which a bank or other financial institution lends cash at interest in return for assuming the title to the debtor's property, on the condition that the obligation is paid in full.
Mortgage
The term "mortgage" is a type of loan that a borrower takes to maintain his house or any form of assets and he agrees to return the amount in a particular period of time to the lender usually in a series of regular equally monthly, quarterly, or half-yearly payments.
Question
Over the life of a fixed payment amortized loan, such as a conventional mortgage, the proportion of the payment that goes to repay principal
-
A : increases each month.
-
B : varies with economic conditions.
-
C : decreases each month.
-
D : stays constant over time.
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