Kay has decided to take out a $23,100 loan, and she wants to pay it back in quarterly installments. She has narrowed her options down to two banks. Bank V offers a six-year loan with an interest rate of 4.6%, compounded quarterly, and has a service charge of $822.45. Bank W offers an eight-year loan with an interest rate of 3.9%, compounded quarterly, and a service charge of $722.25. Which loan will have the greater total finance charge, and how much greater will it be? Round all dollar values to the nearest cent.

Question

solomonzelman · Answer

Do you know the compound interest formula?

anonymous · Answer

I know of it, but every time i try to do it i end up messing up somewhere along the way, this is one of those things that i cant seem to understand no matter how hard i try.

solomonzelman · Answer

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