What will be the assumed future value in loan repayment? |
Principal amount Maturity amount Zero Present value |
Zero |
The correct answer is option 3- Zero. Future value, which is taken as 0, is the balance at the end of the loan period. At the end of the loan period, the (balance) amount payable will be zero assuming that the repayments are made on regular basis. Therefore, the future value (FV) is taken as zero. |