Firstly, Loan A has a lower interest rate (0.25% lower) and therefore the interest payed is lower ($209.49 cheaper) and of course the total paid is lower for Loan A.
The benefit of Loan B is the term of payment is longer and the monthly repayments are lower. This could be good for someone working minimum wage due to having a low income.
In conclusion, I think Loan A would be better due to the interest being lower which is always a plus for loans.
The corridor is the vertical section of the supply curve of reserves in the federal fund market.
Answer:
$25,000
Explanation:
Assuming it is to be perpetuity. Amount to be saved = P/I
Amount to be saved = Annual interest amount / Annual interest rate
Amount to be saved = $2,000/8%
Amount to be saved = $2,000/0.08
Amount to be saved = $25,000
So, the worker should save $25,000 before retirement if he wishes to draw interest of $2,000 per year.