What is the difference between a loan and an investment?

Question

Accepted Answer

A loan is money borrowed that must be repaid with interest, while an investment is money used to purchase assets with the expectation of generating income or profit.

A loan involves borrowing money from a lender and agreeing to repay it over time with interest.
An investment involves using money to purchase assets such as stocks, bonds, or real estate with the expectation of generating income or profit.
Loans typically have fixed repayment terms and interest rates, while investments can vary in terms of risk and potential return.
Examples of loans include mortgages, car loans, and personal loans, while examples of investments include stocks, mutual funds, and real estate.
Loans are liabilities on a balance sheet, while investments are assets.

What is the difference between a loan and an investment?

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