Use the following chart to explain how the amount of principal affects the total cost of the loan. Loan Repayment Period Loan 1 Loan 2 Principal $5,000 $6,000 Interest Rate 6.47 percent 6.47 percent Monthly Payment $98 $117 Loan Repayment Period five years five years Total cost of the loan $5,866 $7,039

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Isabella Oneal

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4 June, 19:00

Use the following chart to explain how the amount of principal affects the total cost of the loan. Loan Repayment Period Loan 1 Loan 2 Principal $5,000 $6,000 Interest Rate 6.47 percent 6.47 percent Monthly Payment $98 $117 Loan Repayment Period five years five years Total cost of the loan $5,866 $7,039

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Owen Villanueva · Answer 1

Well, if you have longer to pay of the loan (10 years) vs a smaller time to pay it off your month to month payments will be much smaller, since you have an extra 5 years to pay it off. Although when you have a longer pay off period, your interest has longer to build, making you overall pay more. Therefore its better to just pay as much as you can at one time.

Im taking the same quiz and thats all their looking for! Its bonus to include 'pay as much as you can rather than paying the minimum amount' since that was a heavy theme throughout the section; )