Question

This one I don't know at all.

A student is graduating from college in six months but will need a loan in the amount of $3,725 for the last semester. The student may receive either an unsubsidized Stafford Loan or a PLUS Loan. The terms of each loan are:

Unsubsidized Stafford Loan: annual interest rate of 4.65%, compounded monthly, with a balance of $3,901.95, at the time of repayment

PLUS loan: annual interest rate of 5.65%, compounded monthly with payment deferred until graduation

Which loan will have a lower balance and by how much at the time of repayment?

The Stafford Loan will have a lower balance by $70.47 at the time of repayment.
The PLUS Loan will have a lower balance by $70.47 at the time of repayment.
The Stafford Loan will have a lower balance by $16.72 at the time of repayment.
The PLUS Loan will have a lower balance by $16.72 at the time of repayment.

Answer 1

Alright so again, based on this which two do you think we can eliminate?

Answer 2

a and b?

Answer 3

mm try again

Answer 4

ok lmao. Im guessing c and d?

Answer 5

Correct, now that we've narrowed it down to two options, by reading the question which do you think would be your answer?

Answer 6

b cause its only till he graduates?

Answer 7

even though it does have te higher intreast rate?

Answer 8

intrest

Answer 9

Correct, your answer is b.

Answer 10

:)