Final answer:
Y-ko-V-ah Bank is the best loan option with the lowest interest rate at 6%. Stocks tend to provide higher average returns over time compared to bonds and savings accounts but come with greater risk. Simple interest calculations show that the total interest on a $5,000 loan at 6% over three years is $900, and a $500 interest received on a five-year $10,000 loan corresponds to an annual interest rate of 1%.
Step-by-step explanation:
If you are considering which loan to recommend purely based on the interest rate, Y-ko-V-ah Bank is your best choice since it offers the lowest rate at 6%. The total amount of interest paid on a loan is directly tied to the interest rate: the lower the rate, the less interest you will pay. Regarding investments, stocks typically offer higher average returns over time compared to bonds or savings accounts, albeit with higher risk.
High-risk investments do not necessarily mean low returns; they can offer high returns, but the chance of losing the investment is also greater. As for the simple interest calculations, for a $5,000 loan at a simple interest rate of 6% over three years, the total interest would be $900. If you received $500 in interest on a $10,000 loan over five years, the annual interest rate you charged would be 1%.