Step-by-step explanation:
So the general formula for compound interest is [tex]A = P(1+\frac{r}{n})^{nt}[/tex] where r is the interest rate, t is the time in years, and n is the amount of compounds per year. So plugging in the values for both equations you'll get
Opportunity Loans:
[tex]A = 1600(1+\frac{0.0345}{12})^{(12)(1)}[/tex]
[tex]A = 1600(1.002875)^{12}[/tex]
[tex]A \approx 1600(1.035)[/tex]
[tex]A = \$1,656.08[/tex]
Now to find the interest accrued on this loan you simply subtract 1600 from the A or final amount
[tex]Interest=1656.08-1600\\Interest=56.08[/tex]
General Loans:
[tex]A = 1600(1+\frac{0.042}{4})^{(4)(1)}[/tex]
[tex]A = 1600(1.0105)^4[/tex]
[tex]A \approx 1600(1.042)[/tex]
[tex]A = 1,668.27[/tex]
To find the interest we do the same thing we did in the previous problem
[tex]interest = 1668.27-1600\\interest=68.27[/tex]
Opportunity loans has the least amount of interest after a year
