# Question

An individual wishes to borrow $10,000 for a year and is offered the following alternatives:

a. A 10 percent loan discounted in advance

b. An 11 percent straight loan (i.e., interest paid at maturity) Which loan is more expensive?

a. A 10 percent loan discounted in advance

b. An 11 percent straight loan (i.e., interest paid at maturity) Which loan is more expensive?

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