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Ann Nguyen would like an installment loan for 5,000. Her bank will loan her the money at 12% for 18 months. Her insurance company will loan her the money at 12% for 24 months. Which loan would cost her less?

Respuesta :

The Bank will provide loan on lesser cost.

The simple interest is given as,

             [tex]Interest=\frac{Principle*rate *time}{100} [/tex]

Given that, Principle is [tex]5000[/tex] , rate is 12 % and time is 18 months.

Time = 18 months= [tex]\frac{18}{12}=1.5 years [/tex]

              [tex]Interest=\frac{5000*12*1.5}{100}=900 [/tex]

Also, Her insurance company will loan her the money at 12% for 24 months.

           [tex]Interest=\frac{5000*12*2}{100} =1200[/tex]

Hence, the Bank will cost her less.

Learn more:

https://brainly.com/question/2294792

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