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Maria took out an unsubsidized stafford loan of $6925 to pay for college. She plans to graduate in four years. What is the amount of loan Maria will have to repay?

User Shammir
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1 Answer

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Final answer:

Maria will have to repay approximately $8427.90 for her unsubsidized Stafford loan of $6925.

Step-by-step explanation:

Since Maria took out an unsubsidized Stafford loan of $6925 to pay for college and plans to graduate in four years, she will have to repay the total amount of the loan plus any interest accrued during the repayment period. However, the interest rate on a Stafford loan may vary. Assuming an average interest rate of 5%, we can calculate the amount Maria will have to repay using the formula for compound interest:

Amount to Repay = Principal (1 + Interest Rate)^Number of Years

Amount to Repay = $6925 (1 + 0.05)^4

Amount to Repay = $6925 (1.05)^4

Amount to Repay = $6925 * 1.21550625

Amount to Repay = $8427.90

Therefore, Maria will have to repay approximately $8427.90.

User Starja
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