Question

Match question with answer

a thing of value a person loses if they default on a loan
2.
a person who borrows money
3.
the cost of borrowing money
4.
the original amount of money someone borrows
5.
the ability to borrow money in order to repay it in the future
6.
a term for an institution that loans money
a.
collateral
b.
interest
c.
credit
d.
lender
e.
principal
f.
borrower

Answer 1

Lender: A person who borrows money

Collateral: A thing of value a person losed if they default on a loan

Borrower: A person who borrows money

Principal: The original amount of money someone borrows

Interest: The cost of borrowing money

Credit: The ability to borrow money in order to repay it in the future

Step-by-step explanation:

Answer 2

1. A thing of value a person loses if they default on a loan. a. collateral

2. A person who borrows money. f. borrower

3. The cost of borrowing money. b. interest

4. The original amount of money someone borrows. e. principal

5. The ability to borrow money in order to repay it in the future. c. credit

6. A term for an institution that loans money. d. lender

Step-by-step explanation:

The term credit refers to the capacity to obtain money today to repay it later, usually in exchange for a specified amount of interest.

Collateral is an asset, such as real estate, that the lender receives as protection for providing a loan, in case the borrower defaults on payments. Credits that are bound by collateral often have considerably lower interest rates than unsecured ones.