The lender offers you two interest rates

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Reference no: EM131002965

You want to borrow $20000. The lender offers you two interest rates to choose from. You can borrow for 8 years at either 10% per year simple interest or at 8.5% per year compounded monthly. The loan is to be paid in a lump sum. How much interest will you pay for each option?

Reference no: EM131002965

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