Questions: Question 16 of 25 Which statement is true about down payments? A. The larger the down payment, the lower the principal. B. The smaller the down payment, the lower the principal. C. The smaller the down payment, the lower the interest rate. D. The larger the down payment, the higher your monthly payments will be.

The answer is A. The larger the down payment, the lower the principal.

This statement is true. The principal is the amount of money borrowed. When you make a larger down payment, you are borrowing less money, which means the principal amount is lower.

This statement is false. A smaller down payment means you are borrowing more money, which increases the principal amount.

This statement is generally false. A smaller down payment often results in a higher interest rate because the lender is taking on more risk.

This statement is false. A larger down payment reduces the principal, which typically results in lower monthly payments.