What is a loan and what does it mean to borrow?

• A. A Gift
• B. A debt forgiveness program
• C. Money borrowed that must be paid back, usually with interest.
• D. An investment

Answer: (C)

Borrowing means getting money now with the plan to pay it back later. A loan is money you receive from a lender that you must repay, usually in regular payments over a set period, and it often includes interest. Interest is the extra amount you pay for using someone else’s money, which is how lenders earn from lending. So a loan is essentially money borrowed that must be paid back, usually with interest.

That description fits best because a Gift is something given without repayment, a debt forgiveness program reduces what you owe rather than describing borrowing, and an investment is putting money into something to grow it, not borrowing money.