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15 October, 22:39

Marco took out an unsubsidized student loan for $20,000 which he will start paying in four years after he graduates if the interest rate is 4.2% what is the amount he will or once he graduates

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  1. 15 October, 23:09
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    I'm going to assume that this is compound interest, as simple interest in this case would not make sense.

    Let A be the final amount (in this case, after 4 years). A = 20,000 (1+0.042/12) ^12*4. In this formula, I am assuming that the interest compounds 12 times a year, or every month. I am also assuming that he pays it off once he hits the 4-year mark.

    If the assumptions are correct, he would be paying $23651.79 at the 4-year mark.
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