Final answer:
Rodrick borrowed a total of $28,800. By adjusting the monthly payments, he can potentially shorten the loan term and save a significant amount on interest, as demonstrated with other loan scenarios.
Step-by-step explanation:
The amount that Rodrick borrowed on August 1 was $28,800. When we look closer at various loan scenarios, we can see significant differences in repayment amounts over time. For instance, a certain monthly payment R of $1798.65 will accumulate to a total repayment sum of $647,514.57 over the span of 30 years, which is more than twice the original loan amount. Conversely, if the monthly payment was increased to $1948.54, Rodrick would pay off the loan in about 24.5 years, resulting in substantial savings.
Similarly, if you had a $1,000,000 loan with a 6% interest rate over 30 years, you would have to make 360 payments of $5995.51 each, ultimately repaying over twice the principal amount. A different example includes a yearly payment of $12,000 for a 30-year house loan at a 4.2% interest rate, where the total repayment would equal $360,000.