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Answer:
a)
b) The balance after 8 years will be of $29,069.
Step-by-step explanation:
Compound interest:
The compound interest formula is given by:
Where A(t) is the amount of money after t years, P is the principal(the initial sum of money), r is the interest rate(as a decimal value), n is the number of times that interest is compounded per year and t is the time in years for which the money is invested or borrowed.
a)
Loan of $17,500 means that
6.4% interest rate means that
Compounded monthly means that . So
b)
This is A(8). Then
The balance after 8 years will be of $29,069.