##### (answered) - What are the formulas to A, B, C,D? How do you actually get the

Description

Question

What are the formulas to A, B, C,D? How do you actually?get the answer to the problem? step by step?

Year in

college

Amount

Interest

borrowed rate

1

\$3,500

3.40%

2

\$4,000

3.40%

3

\$5,000

3.86%

4

\$5,000

4.66%

Note : We assume that student borrowed the loan from starting of the year

It is assume that the whole amount loan is subsidized loan

a

How much do you owe after graduating = \$17,500

Year in

college

b

Amount

Interest Total Amount Interest

borrowed rate

to be paid

Amount

\$4,009.05

\$509.05

1

\$3,500

3.40%

\$4,428.84

\$428.84

2

\$4,000

3.40%

\$5,400.66

\$400.66

3

\$5,000

3.86%

\$5,238.02

\$238.02

4

\$5,000

4.66%

\$19,076.58 \$1,576.58

What is the consolidated interest rate?

Add the per loan weight factors together to obtain the total per loan weight factor. = \$1576.58

Year in

college

Amount

Interest Total Amount Interest

borrowed rate

to be paid

Amount

\$3,620.86

\$120.86

1

\$3,500

3.40%

\$4,138.12

\$138.12

2

\$4,000

3.40%

\$5,196.47

\$196.47

3

\$5,000

3.86%

\$5,238.02

\$238.02

4

\$5,000

4.66%

\$18,193.47

\$693.47

Add the loan amounts together to obtain the total loan amount. = \$693.47

Divide the total per loan weight factor by the total loan amount. Multiply this by 100 to express it as a percentage.

This will give you the actual interest rate. = \$693.47/\$17500 = 3.96%

c

How much do you have to pay each month if you want to pay off the consolidated loan in five years?

\$321.97

d

Assume you can pay \$200 per month. How long does it take to pay off the consolidated loan?

8.625 years

Solution ID:1037827 | Question answered on 27-Aug-2016

Price : \$14

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