Question

The ending balance of an amortized loan contract will always be ________?

1) zero
2) positive
3) negative
4) unknown

Answer 1

The ending balance of an amortized loan contract will always be initially positive, steadily decreasing, becoming negative at the end.

Step-by-step explanation:

The ending balance of an amortized loan contract will always be option c) initially positive, steadily decreasing, becoming negative at the end. This is because an amortized loan is a loan that is paid off in regular, equal installments over a specific period of time. As the loan is paid off, the outstanding balance decreases until it eventually becomes negative or zero at the end of the loan term.