(Comparing Types of Interest MC)

An advertising company is purchasing a new industrial-sized color printer. The company has been approved for a $75,000 loan at two different banks. The terms of each loan are:

Offer 1: 2.99% annual simple interest, with a total account balance of $81,353.75 after a 34-month term
Offer 2: 1.5% annual interest compounded monthly for a 38-month term

Assuming no payments are made, what is the difference in the account balances at the end of the loan terms. Round your answer to the nearest penny.

$1,718.99
$2,001.57
$2,707.62
$2,489.68

Question

(Comparing Types of Interest MC)

An advertising company is purchasing a new industrial-sized color printer. The company has been approved for a $75,000 loan at two different banks. The terms of each loan are:

Offer 1: 2.99% annual simple interest, with a total account balance of $81,353.75 after a 34-month term
Offer 2: 1.5% annual interest compounded monthly for a 38-month term

Assuming no payments are made, what is the difference in the account balances at the end of the loan terms. Round your answer to the nearest penny.

$1,718.99
 $2,001.57
 $2,707.62
 $2,489.68

Deadshot · Answer

$1,718.99.