Question

1. Rachel borrowed $1000. The interest rate for her loan is 8%. What is the difference in the interest she’ll pay if she pays it back in 2 years or 3 years?

Work here:






Answer:


1. Would it be better to have a loan with 5% interest, paid back in 2
years, OR a loan with 2% interest paid, back in 5 years? Explain.
Show work to justify your answer.
Work here:






Answer:

Answer 1

$80

Explanation:

Answer 2

Part A 2 years

1000*8%=80 so 1080

1080*8%=86.4 so 1166

Part B

first plan means you pay $1102.50

second plan means you pay $1104.08

so the first is better