What is the process of paying off a debt over a fixed period with specified payments and interest?

The process of paying off a debt over a fixed period with specified payments and interest is known as amortization. This method involves breaking down the total amount owed into regular payments that are applied toward both the principal amount and the interest over the life of the loan. Each payment reduces the outstanding balance, gradually extinguishing the debt by the end of the designated term.

Amortization is commonly used in loans like mortgages and auto loans, where the borrower can predict and plan for the number of payments and the total cost of borrowing over time. This structured repayment plan provides clarity and stability, allowing borrowers to understand how much they will pay and when.

The other options don't fit this description. For instance, fiscal policy refers to government spending and tax policies used to influence economic conditions rather than a specific repayment schedule for debt. Appreciation typically relates to an increase in the value of an asset, and revolving credit describes a credit line that allows borrowers to draw, repay, and borrow again rather than adhering to a fixed repayment schedule.