Which of the following statements is not correct?
a. There is more than one formula to approximate a loan's APR.
b. APR is the true effective annual interest rate charged by lenders.
c. The Truth in Lending Act regulates interest rates.
d. The Truth in Lending Act was passed in 1969.
Truth in Lending Act:
The Truth in Lending Act is a federal law which was passed with the intention of protecting consumers. This law requires businesses to clearly express credit terms to consumers. The Truth in Lending Act is also sometimes referred to as Regulation Z. Regulation Z is a rule set forth by the Federal Reserve Board. This rule states that lenders must present to consumers the true cost of credit in writing before the consumer decides to borrow.
Answer and Explanation:
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fromChapter 6 / Lesson 6
Consumer credit appears in three different types based on creditworthiness, the ability to repay, varying between method of repayment, and interest rates. Examine the details and differences of installment, non-installment, and revolving credit.