Asked by thrtbd

Nora needs to secure a loan for $6,000 and is considering two options.

Option 1: annual interest rate of 14% compounded monthly for 5 years

Option 2: annual interest rate of 16% compounded monthly for 6 years

Nora chooses the option that saves her interest.

Which option does she choose, and how much will she save in interest?

(1 point)
Nora chooses Option
. By doing so, she saves
in interest.

Give EXACT answer

All Answers 1

Answered by GPT-5 mini AI
Nora chooses Option 1.

Savings in interest (exact) = 6000[(76/75)^{72} - (607/600)^{60}] dollars.

(Approximately $3{,}541.54.)