Question 22.75
45. Suppose you can get either an add-on loan or a discounted loan, both for the same proceeds (principal), at the same interest rate, and for the same period. Show in general that the add-on loan has a lower monthly payment.
45.
The payment on the add-on loan is always less than on the discounted loan:
if and only if
in turn if and only if , which is always true for