Finance
In South Dakota, 'amortization' of a mortgage loan means:
AThe interest rate decreases over the loan term
BThe gradual repayment of the loan through periodic payments that include both principal and interest✓ Correct
CThe loan balance increases each month
DThe lender's profit on the loan
Explanation
Amortization is the process of gradually paying off a loan through regular payments that include both interest (calculated on the outstanding balance) and principal. In early payments, more goes to interest; over time, more of each payment reduces the principal balance.
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