Boatler Used Cadillac Company requires $$970,000$ in financing over the next two years. The firm can borrow the funds for two years at $8$ percent interest per year. Ms$.$ Boatler decides to do forecasting and predicts that if she utilizes short$-$term financing instead, she will pay $5\mathrm{.}75$ percent interest in the first year and $10\mathrm{.}55$ percent interest in the second year. Assume interest is paid in full at the end of each year.

Determine the total two$-$year interest cost under each plan.

Which plan is less costly$?$

multiple choice

Long$-$term fixed$-$rate plan

Short$-$term variable$-$rate plan