For an installment loan using simple interest and equal payments throughout the life of the loan, Interest is charged only on the outstanding balance. As each payment is made, more of it is allocated to reducing the principal. As the principal owed decreases, so too does the interest charged on it. Since the payment is always the same each month, the allocation between principal and interest is always different (more to the principal and less to the interest) The add-on method is a widely used technique for computing interest on Installment loans. With the add-on method, Interest is calculated by applying the stated interest rate to the original balance of the loan. Crystal and Hilary are taking out installment loans for $1,700 at a stated interest rate of 6%. The term of each loan is five years. Monthly Installment Loan Payments to Repay a $1,000, Simple Interest Loan Number of Monthly Payments 48 72 60 12 84 Rate of Interest 24 $43.87 36 $29.97 $23.03 $18.87 $16.10 $14.13 $85.61 $86.07 586.53 6 $44.32 $30.42 $14.61 $19.33 $16.57 $19.80 7 $17.05 $44.77 $45.23 $30.88 $31.34 $23.49 $23.95 $24.41 $24.88 $15.09 $15.59 $86.99 8 $20.28 $45.68 $20.76 9 $31.80 $16.09 $87.45 $87.92 $17.53 $18.03 $18.53 519.03 10 $16.60 $46.14 $32.27 $25.36 $21.25 11 $17.12 $88.38 $46.61 $21.74 $32.74 $33.21 $19.55 $22.24 $17.65 12 $88.85 $47.07 $47.54 $25.85 $26.33 $26.83 $27.33 $18.19 13 $89.32 $33.69 $20.07 $20.61 $21.14 $18.74 $22.75 $23.27 $23.79 $89.79 $90.26 14 $34.18 $34.67 $48.01 $48,49 $48.96 $27.83 $19.27 15 $28.34 $21.69 $19.86 $35.16 16 $22.25 $20.44 17 $35.65 590.73 $91.20 $91.68 $92.16 $49.44 $49.92 $24.32 $24.85 $25.39 $25.94 $28.85 $29.37 $29.90 $36.15 $36.66 18 $22.81 $23.38 $21.02 $21.61 19 $50.41 Crystal and Hilary are taking out installment loans for $1,700 at a stated interest rate of 6%. The term of each loan is five years. Number of Monthly Payments Rate of Interest 12 24 36 48 60 72 84 5 $85.61 $43.87 $29.97 $23.03 $18.87 $16.10 $14.13 6 $86.07 $44.32 $23.49 $19.33 $16.57 $30.42 $30.88 7 $86.53 $44.77 $23.95 $19.80 $17.05 $14.61 $15.09 $15.59 8 $86.99 $45.23 $31.34 $24.41 $20.28 9 $87.45 $45.68 $31.80 $20.76 $17.53 $18.03 $18.53 $24.88 $25.36 $16.09 10 $87.92 $46.14 $32.27 $21.25 $16.60 $17.12 11 $88.38 $46.61 $32.74 $25.85 $21.74 $19.03 12 $88.85 $47.07 $33.21 $22.24 $17.65 $26.33 $26.83 $19.55 $20.07 13 $89.32 $47.54 $33.69 $22.75 $18.19 14 $89.79 $48.01 $34.18 $27.33 $20.61 $18.74 $23.27 $23.79 15 $34.67 $27.83 $19.27 $90.26 $90.73 $48.49 $48.96 $21.14 $21.69 16 $28.34 $24.32 $19.86 17 $91.20 $49.44 $35.16 $35.65 $36.15 $28.85 $24.85 $20.44 $22.25 $22.81 18 $91.68 $49.92 $29.37 $25.39 $21.02 19 $92.16 $50.41 $25.94 $23.38 $21.61 $36.66 $37.16 $29.90 $30.43 20 $92.63 $50.90 $26.49 $23.95 $22.21 Answer the following questions using the preceding repayment information table as necessary Crystal Hilary Crystal's loan uses simple interest to compute finance charges Hilary's loan uses the add-on method to compute finance charges Crystal's monthly payment rounded to the nearest cent is $ Hilary's total finance charge rounded to the nearest cent is $ Complete the following tables using all interim figures rounded to the nearest cent in your calculations. Enter al figures as positive numbers rounded to the nearest cent. (Note: The tables are slightly different to reflect the different methods used for finance charges.) Crystal - Simple Hilary - Add-on Total payments $ Principal Principal $ Finance charge $ Finance charge $ Total payments $ $ who paid more for the same loan? Crystal, whose loan used the add-on method to compute finance charges Hilary, whose loan used the simple interest method to compute finance charges Crystal, whose loan used the simple interest method to compute finance charges Hilary, whose loan used the add-on method to compute finance charges