Question

lamar is considering two loans.

which loan will have the lowest total payback?

loan a will have the lowest total payback because the amount of interest paid is less than the amount of interest paid for loan b.
loan a will have the lowest total payback because the total of the principal and the interest paid for loan a is less than the same total for loan b.
loan b will have the lowest total payback because the interest is less than the interest for loan a.
loan b will have the lowest total payback because the total of the principal and the interest paid for loan b is less than the same total for loan a.

Explanation:

Calculate interest for Loan A

Using the Simple Interest Formula knowledge point

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Calculate total payback for Loan A

Using the Total Payback Calculation knowledge point

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Calculate interest for Loan B

Using the Simple Interest Formula knowledge point

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Calculate total payback for Loan B

Using the Total Payback Calculation knowledge point

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Compare total payback amounts

Using the Total Payback Calculation knowledge point

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Answer:

• Loan A will have the lowest total payback because the amount of interest paid is less than the amount of interest paid for loan B.
• Loan A will have the lowest total payback because the total of the principal and the interest paid for loan A is less than the same total for loan B.
• Loan B will have the lowest total payback because the interest is less than the interest for loan A.
• Loan B will have the lowest total payback because the total of the principal and the interest paid for loan B is less than the same total for loan A. (Correct answer)