Refer to question 5. If Sharon had been able to afford the four- year loan, how much interest would she have saved compared to the five- year loan?
In Question 5
After making the down payment, she will finance $ 15,500. Sharon is offered three maturities. On a four- year loan, Sharon will pay $ 371.17 per month. On a five- year loan, Sharon’s monthly payments will be $ 306.99. On a six- year loan, they will be $ 264.26. Sharon rejects the four- year loan, as it is not within her budget. How much interest will Sharon pay over the life of the loan on the five- year loan? On the six- year loan? Which should she choose if she bases her decision solely on total interest paid?