Question
Sky needs $6700 for school and has two options. Option A: 5 years at 5% interest with monthly payments of $126.44 Option B: 6 years
Sky needs $6700
for school and has two options.
Option A: 5
years at 5%
interest with monthly payments of $126.44
Option B: 6
years at 3.5%
interest with monthly payments of $103.30
Calculate the total payback on each loan and calculate how much Sky will save by choosing option B.
Total payback option A =
Total payback option B =
Sky will save $____by choosing loan option B.
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An Introduction to the Mathematics of financial Derivatives
Authors: Salih N. Neftci
2nd Edition
978-0125153928, 9780080478647, 125153929, 978-0123846822
