Martin borrows some money and does not make any payments on it. The interest he owes on the money accumulates over five years as added liability. In which situation would he owe the most?
A) He borrowed $1,000 at an interest rate of 5%.
B) He borrowed $800 at an interest rate of 8%.
C) He borrowed $1,090 at an interest rate of 3%.
D) He borrowed $760 at an interest rate of 11%.

Question

Quizplus · Accepted Answer

Martin would owe the most if he borrowed $760 at an interest rate of 11% because both the principal amount and the interest rate are the lowest among the given options. 11% interest on $760 would accumulate to $580.52 over five years.

Martin Borrows Some Money and Does Not Make Any Payments