Alyssa may apply for an unsubsidized Stafford Loan with an interest rate of 6.8%, compounded monthly and a grace period of six months from the time of graduation. Or, Alyssa may have her parents apply for a PLUS Loan with an interest rate of 7.8%, compounded monthly. She will be graduating from college in a year and a half and needs a loan in the amount of $11,895. Which loan is the better choice and why?

At vero eos et accusamus et iusto odio dignissimos ducimus qui blanditiis praesentium voluptatum deleniti atque corrupti quos dolores et quas molestias excepturi sint occaecati cupiditate non provident, similique sunt in culpa qui officia deserunt mollitia animi, id est laborum et dolorum fuga.
Et harum quidem rerum facilis est et expedita distinctio. Nam libero tempore, cum soluta nobis est eligendi optio cumque nihil impedit quo minus id quod maxime placeat facere possimus, omnis voluptas assumenda est, omnis dolor repellendus.
Itaque earum rerum hic tenetur a sapiente delectus, ut aut reiciendis voluptatibus maiores alias consequatur aut perferendis doloribus asperiores repellat.

Get our expert's

answer on brainly

SEE EXPERT ANSWER

Get your **free** account and access **expert** answers to this

and **thousands** of other questions.

- anonymous

- katieb

See more answers at brainly.com

Get this expert

answer on brainly

SEE EXPERT ANSWER

Get your **free** account and access **expert** answers to this

and **thousands** of other questions

- anonymous

-The Stafford Loan is the better choice because it is $197.81 cheaper than the PLUS Loan.
-The PLUS Loan is the better choice because it is $256.32 cheaper than the Stafford Loan.
-The PLUS Loan is the better choice because it is $454.13 cheaper than the Stafford Loan.
-The Stafford Loan is the better choice because it is $273.50 cheaper than the PLUS Loan.

- anonymous

- anonymous

use ur own brain

Looking for something else?

Not the answer you are looking for? Search for more explanations.

## More answers

- anonymous

I tried. Give me a formula and I can do it. I can't find the formula.

- mathmate

Amount after n months, compounded monthly
A=P(1+r/12)^n
r=interest rate per annum
P=principal (borrowed amount)
n=number of months money was borrowed.
Calculate the amount to be repaid for each option and make your choice accordingly.

- anonymous

pi=prt/100

- anonymous

@mathmate what would n be? i put 18, but i don't think that's right.

- mathmate

I am not too sure if the "grace period" is just an extended repay period where interest continues to grow.
If you calculate it for n=18, you would get one of the answers. And for n=24, you would get another answer. The answer depends on when she is ready to repay (completely), 18 or 24 months. Make a choice.

- anonymous

Grace period is the months where interest isn't charged. Like a credit card.

- anonymous

I'm not getting the right answer. I'll just pick a random answer.

- mathmate

If that's the interpretation, then PLUS loan will charge (higher) interest for 24 months while the Stafford loan charges (lower) interest for 18 months. The difference comes to be $727.64, which is not one of the answers.

- anonymous

The Stafford Loan is the better choice because it is $197.81 cheaper than the PLUS Loan.

Looking for something else?

Not the answer you are looking for? Search for more explanations.