Final answer:
Barry Wood will have a monthly payment of $191.67 for the add-on interest loan and $214.17 for the simple interest amortized loan.
Step-by-step explanation:
To find the monthly payment for each loan, we can use the formulas for add-on interest loan and simple interest amortized loan.
Add-on Interest Loan:
The total amount to be paid back for the add-on interest loan is the loan amount plus the interest. The monthly payment can be found by dividing the total amount by the number of months:
Total amount = loan amount + interest = $6000 + ($6000 * 5% * 3) = $6000 + $900 = $6900
Monthly payment = total amount / number of months = $6900 / 36 = $191.67
Simple Interest Amortized Loan:
The total amount to be paid back for the simple interest amortized loan is the loan amount plus the interest. The interest can be calculated using the formula:
Interest = loan amount * interest rate * time = $6000 * 9.5% * 3 = $1710
Total amount = loan amount + interest = $6000 + $1710 = $7710
Monthly payment = total amount / number of months = $7710 / 36 = $214.17