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NEW · QUESTION BANKS FOR ALL 5 UNITS, FROM $6.95 →

Principal

The original sum borrowed, saved, or invested, before any interest is added.

On a loan payment, the part that reduces principal shrinks the debt itself, while the interest part is the fee for that period.

Taught In

See Also

3.1.A.3 · 3.2.A.2 · 3.5.B.1.i