Question

Two consumers borrowed 10000 for five years bob has credit score of 650 and has an intrest rate of 11.5% while tyree has a credit score of 710 and has an intrest rate of 8.0% what will be the total diffrence between what the two men pay?
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Answer 1

Here is the answer to the problem above.

For Bob:

m = 10,000 (0.115/12) (1 + 0.115/12) (12.5)
       ---------------------------------------------------
             (1 + 0.115/12) (12.5) - 1
m = 219.93 * 60
m = $13195.80

For Tyree:

m = 10,000 (0.08/12) (1 + 0.08/12) (12.5)
       ---------------------------------------------------
             (1 + 0.08/12) (12.5) - 1
m = 202.76 * 60
m = $12165.60

M of Bob - M of Tyree
$13195.80 - $12165.60 = $1030.20

$1030.20 is the total difference between the two men.