### Loan Interest Calculation and Future Value Analysis#### ContextSuppose you have borrowed $9800 for school expenses at a 6% simple interest rate for 6 years.#### Part 1 of 4**(a) How much simple interest would you pay?**After 6 years, you would pay \$3528 in simple interest.---#### Part 2 of 4**(b) Suppose the bank splits the loan into six 1-year loans, so that the future value of the loan would be recalculated at the end of each one-year period, with interest charged on the new amount for the next year.**Fill in the following table, which will show the future value of the loan at the end of each 1-year period. Round to the nearest dollar.| End of Year | 1 | 2 | 3 | 4 | 5 | 6 ||-------------|------|------|------|------|------|------|| Future Value, $ | | | | | | |---#### Visual Explanation:- **Table**: - The table consists of two rows: "End of Year" and "Future Value, $". - The "End of Year" row lists the years from 1 to 6. - The "Future Value, $" row is meant to be filled in with the calculated future value of the loan at the end of each respective year.

we need to calculate the interest for each year and add it to the previous year's…

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Suppose you have borrowed $9800 for school expenses at 6% simple interest for 6 years.

College Algebra

7th Edition

ISBN:9781305115545

Author:James Stewart, Lothar Redlin, Saleem Watson

Publisher:James Stewart, Lothar Redlin, Saleem Watson

Chapter8: Sequences And Series

Section8.4: Mathematics Of Finance

Problem 1E: An annuity is a sum of money that is paid in regular equal payments. The __________ of an annuity is...

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Question

### Loan Interest Calculation and Future Value Analysis

#### Context
Suppose you have borrowed $9800 for school expenses at a 6% simple interest rate for 6 years.

#### Part 1 of 4

**(a) How much simple interest would you pay?**

After 6 years, you would pay \$3528 in simple interest.

---

#### Part 2 of 4

**(b) Suppose the bank splits the loan into six 1-year loans, so that the future value of the loan would be recalculated at the end of each one-year period, with interest charged on the new amount for the next year.**

Fill in the following table, which will show the future value of the loan at the end of each 1-year period. Round to the nearest dollar.

| End of Year | 1 | 2 | 3 | 4 | 5 | 6 |
|-------------|------|------|------|------|------|------|
| Future Value, $ | | | | | | |

---

#### Visual Explanation:
- **Table**:
- The table consists of two rows: "End of Year" and "Future Value, $".
- The "End of Year" row lists the years from 1 to 6.
- The "Future Value, $" row is meant to be filled in with the calculated future value of the loan at the end of each respective year.

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Step 1: To calculate the future value of the loan at the end of each 1-year period

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