If you attended Mt. IveySchmivey—with a 4 year tuition of $125,000—and paid a monthly loan payment of $562 (roughly 15% of your $45,000 salary as a social worker), how long would it take you to pay off a student loan at a 5% interest rate?
Tuition=$125,000 Interest rate= 5% 5% of $125,000 = $6,250 $125,000 + $6,250 = $131,250 $131,250/$562(monthly payment) = 233.540925 233.540925/12(months in a year) = 19.4617438 round up and it 19.5 years
Use the formula of the present value of annuity ordinary A=p [(1-(1+I)^-kn)/I] Solve for n N=[log ((AI/p)-1)/log (1+I)]/-k equation A 125000 I 0.05/12 P 562 K 12 Plug in the equation above N=52.39 years round your answer N=52.4 years So the answer is c
